Matters: On the evening of October 12, Anxin Trust announced its 2017 three-quarter report. It achieved total revenue of more than 4.196 billion yuan during the period, an increase of 19.40% over the previous year, and net profit attributable to owners of the parent company of more than 2,825 billion yuan, an increase of 22.27% over the previous year. Key points 1. The trust business performed excellently in the third quarter. The rise in the stock market smoothed out investment losses in the first half of the year. Overall, the company's performance in the first three quarters was in line with expectations. The Q3 performance improved markedly, generating net profit of 1,213 billion yuan in a single quarter, up 32.19% year on year, and a significant increase of about 105% from Q2. Among them, income from changes in fair value increased from -456 million yuan as reported in the interim to about 47 million yuan, which turned negative into positive. We expect the stock market to perform well in the third quarter, which smoothed out investment losses in the first half of the year, but still decreased 180 million yuan compared to the same period last year; investment income for the current period was about 413 million yuan, an increase of 204 million yuan over the same period last year. The company continued to take advantage of active management of the trust business. Current fee and commission revenue was $3.663 billion, an increase of 27.09% over the same period last year. Q3 single-quarter fee and commission revenue was $1,307 billion, up 31.68% year on year and 66% month on month. At the same time as operating income increased, business and management expenses also increased. The current period's business and management expenses were 638 million yuan, an increase of 35.71% over the previous year. The growth rate was faster than the revenue growth rate. Judging from the interim report, the main reason may be the increase in estimated trust business reserves. 2. New progress has been made in the extension layout, and capital strength is expected to increase again at the end of September. The company announced that, as one of the five investors, it plans to subscribe for no more than 411,778,133 new shares issued by China CITIC Bank (International) Limited at no more than HK$1,2312.2 billion, at a subscription price of HK$2.99 per share. After the additional issuance is completed, the shares held by Anxin Trust shall not exceed 3.4% of the total share capital of CNCBI. According to CNCBI's financial data for the first half of 2017 (unaudited), CNCBI had total assets of HK$327.6 billion and net assets of HK$33.337 billion. In the first half of 2017, it achieved operating income of HK$3,972 billion and profit after tax of HK$1,388 billion. Total revenue attributable to shareholders was HK$1,550 billion. The total revenue attributable to shareholders was HK$1,550 billion. The overall revenue attributable to shareholders was steady and the target was excellent. This layout will further optimize the company's revenue structure and pave the way for international asset allocation. Furthermore, the company recently announced that it plans to issue a total of no more than 68 million preferred shares on a non-public basis, and raise no more than 6.8 billion yuan in total capital, further complementing the company's operating capital. Since the Banking Regulatory Commission promulgated the “Measures for the Management of Net Capital of Trust Companies” in 2010, the net capital size of trust companies will directly affect the size of manageable trust assets, which in turn will affect the income and profits of trust companies. After the company completed a fixed increase in 2016, the capital raised by the company of 4.975 billion yuan greatly improved the company's business capacity and operating performance. If the issuance of preferred shares is successful, the company's profitability and resilience to risks will be further enhanced. 3. The trust industry continues to be prosperous, and both scale and profit levels have increased. Judging from the latest social finance data released by the People's Bank of China, trust loans were added by 114.3 billion yuan in August, which contracted somewhat from month to month, but it still increased 55% year on year, maintaining a high growth rate. The cumulative size of trust loans from January to August this year was 1549 billion yuan, a sharp increase of 314% over the previous year, while the share of trust loans fluctuated from 3% last year to more than 10% this year. Against the backdrop of tightening of financing through other channels, trusts continue to play a role in smoothing financing needs in the real economy. According to data from the Trust Industry Association, as of the end of June 2017, the trust assets of the entire industry were 23.14 trillion yuan, another record high, up 34% year on year, and 5.33% month on month in the second quarter. In the second quarter of 2017, the trust industry achieved revenue of 28.102 billion yuan, the same year on year, with a year-on-year increase of 29.62%; industry profit was 20.948 billion yuan, up 5.04% year on year and 34.83% month on month. There has been a steady increase in scale and profitability. Overall, the trust industry remains prosperous. This is also confirmed by the fact that the year-on-year performance of some trust companies that have announced A-share listed companies continues to improve. We expect the trust industry to continue to operate smoothly throughout the year, and is expected to continue to increase in scale and profit levels. 4. Looking at the investment proposals, the company's three-quarter report performance was in line with expectations. After the disclosure of the previous interim results, the decline in the company's growth rate caused investors to worry about whether the company's high growth could continue, and the stock price pulled back somewhat. However, the growth rate of the three-quarter report has been upgraded again, indicating that the company is operating steadily, and the trust business with active management as the core continues to grow. It is expected that the annual performance will continue to maintain a relatively rapid growth rate. Combined with the preferred stock issuance plan that the company is actively preparing, capital strength will be further enhanced, opening up space for further business expansion. Furthermore, the securities company continued to increase its holdings of listed companies in the third quarter. The shareholding ratio increased from 2.31% in the interim report to 3.47%. The shareholding ratio of Central Huijin Company remained unchanged at 0.91%, which shows to a certain extent its recognition of the company's operations and development. Overall, we raised the company's profit forecast. We expect the company's EPS in 2017/2018 to be 0.82/0.93 yuan, respectively, and the corresponding PE is 15.9/14.1 times. The company is the only subject of trust included in MSCI. Combined with the company's reasonable valuation, we gave the company a target price of 16 yuan. Risk warning: Trust industry regulation is being tightened, and company performance growth falls short of expectations