Incident: According to the announcement, Tevelun Network Technology Co., Ltd. (a wholly-owned subsidiary) plans to cooperate with Alibaba Investment Limited and Jiangsu Kangzhong Auto Parts Co., Ltd. in the automotive aftermarket, which is divided into cooperation in supply chain business and store business. Ali, Jingu, and Kang Zhong joined forces to reap top traffic and auto parts supply chains in one fell swoop. 1) According to the announcement, Ali will invest RMB 1.6 billion in cash and will hold about 46.97% of the shares in the joint venture, Teveland will hold about 16.27% of the shares, and the joint venture will obtain exclusive operating rights for Taobao and Tmall's corresponding automotive aftermarket service categories. 2) Auto Superman has been deeply cultivated for 5 years and has high-quality offline stores (more than 400 direct stores nationwide, more than 20,000 cooperative stores), seven major national warehousing systems, mature store SaaS systems, and a large number of aftermarket service personnel; Kangzhong Auto Parts has an auto parts supply chain covering the whole country, involving nearly 30 provinces and more than 200 cities; and Ali has top online traffic and strong capital support. The advantages of the three are highly complementary, opening up the three key links of online traffic, offline stores, and supply chain support in the automotive aftermarket, and establishing an absolute leader in new retail sales of domestic automobile services. Alibaba's “traffic+big data” enhances new retail value, and the Blue Ocean space is finally leading the automotive aftermarket service integration. 1) According to a report by Sohu.com, Ali's online customer acquisition costs have reached 700 yuan. As a result, Internet giants such as Tencent, Alibaba, and JD are speeding up offline expansion and seizing offline traffic. In particular, Ali launched a new retail brand “Hema Xiansheng” in 2017, and in April 2018, it bought for 9.5 billion US dollars. Are you hungry? 2) According to iResearch data, as of December 2017, the number one MAU for car maintenance apps in China was Tourover Car Maintenance, with over 3.5 million, and the second tier was Auto Superman, Car Enjoyer, etc., all with MAUs of around 1 million. According to Nielsen data, over 65% of Alibaba buyers own cars, and big data can accurately reach and influence 60 million of them. Therefore, the introduction of Alibaba traffic will catch up with the industry's number one. Combined with Alibaba's big data analysis capabilities, it is expected to increase the new retail value of offline stores. 3) According to industry research, there are more than 700,000 auto repair and beauty stores in China, and they are growing rapidly. The industry is characterized by fragmentation, low efficiency, and poor user experience. In contrast, American auto services are all branded and grouped companies. Auto Superman's business model has been verified and has a huge number of integrated markets. Received financial support from fund-raising projects, and accelerated expansion of offline stores. 1) The new Smart Car Huida undertakes the corresponding assets for the Tevelun store business. Twilun holds 80% of the shares, and the joint venture holds 20% of the shares. 2) The company's core stores are mainly expanding steadily through direct management and investment. Under the premise of ensuring the brand's service quality, local high-quality store resources are selected for in-depth strategic cooperation. The technical, business and card barriers are deep enough. In July 2017, a plan of 10,000 stores in 100 cities was launched, and the expansion rate of core stores has accelerated markedly. According to grassroots research, it has reached 400 stores nationwide. 3) The amount of the company's initial fund-raising project changed, that is, the integration of offline partners increased from 400 million to 2.05 billion. After receiving capital support, offline stores are expected to expand at an accelerated pace. Give it an “gain” rating. It is expected that the traditional steel wheel business will develop steadily, and the automotive aftermarket, financial business and environmental protection equipment will grow rapidly. Based on the above key assumptions of business revenue and expenses, the company's revenue for 2018-2020 is estimated to be $4.563 billion, $6.173 billion, and $7.768 billion, respectively, and net profit attributable to mother of $241 million, $395 million, and $588 million, respectively. Risk warning: Store expansion falls short of expectations; profitability falls short of expectations; affected by downstream industry cycle fluctuations.