Event: the company released its quarterly report for 2017, with total revenue of 9.798 billion yuan in the first three quarters, an increase of 61.2% over the same period last year. The net profit of the parent was 1.233 billion yuan, an increase of 48.2% over the same period last year. The total revenue in the third quarter was 3.401 billion yuan, an increase of 49.7% over the same period last year. The net profit returned to the mother was 365 million yuan, an increase of 338.5% over the same period last year.

Comments:

Profits surged in the third quarter, and securities plus insurance earnings were stable. The company's total revenue in the first three quarters maintained its first-half growth, which is expected to benefit from a pick-up in commodity prices, as the company's bulk trading sector continued its performance in the first half and revenue surged. The profit in the third quarter is 365 million yuan, an increase of 338.5% over the same period last year. It is expected that the trade sector will not only turn losses into profits this year, but also improve the overall performance of the company. The investment income was 1.621 billion yuan, an increase of 23.9% over the same period last year. The main variable was Carrefour equity transfer (398 million yuan). GF Securities Co., LTD. 's performance grew by about 3% in the first three quarters, and the performance of Zhonghua United property Insurance may decline, but the contribution of securities + insurance is still stable.

The prosperity of traditional trade is upward, and the potential for development needs to be released. This year, the company's traditional commodity trading business has turned a profit, and the prosperity is up. Energy assets may be gradually cleared, and the structure is expected to be continuously optimized, which will help to repair market confidence. GF Securities Co., LTD., the core asset, and Zhonghua United property Insurance have a sound overall development, providing double support for the company's performance and market capitalization. As of the third quarterly report, the proportion of shares held by new shareholder Tehua Investment has increased to 8.06%, and the cost of holding shares may be slightly less than 20 yuan (11.1% premium). The company has made frequent moves this year to clear the way for the release of development potential.

Investment suggestion: the company holds high-quality securities and insurance assets, and the asset structure will be continuously optimized. The value of the company is low for a long time, the future fundamentals tend to be better, development or meet a major breakthrough, continue to recommend, the target price is 22.79 yuan.

Risk hint: the company's business development is not up to expectations.