Description of the incident: Cultural Investment Holdings announced the 2016 interim report results on August 20. During the reporting period, the company achieved operating income of 853.21,151 million yuan; net profit attributable to the owners of the parent company was 241.389 million yuan. Incident reviews have increased the investment layout of the film and television business, and the industrial chain has been continuously improved. 1) Screening side: In the first half of the year, Yaolai Studios achieved box office revenue of 337 million yuan, an increase of 14% over the previous year, with 10.1 million movie viewers; 7 new cinemas and 49 screens were added. Beijing Yaolai Chenglong International Cinemas Wukesong Branch became the second-largest cinema in the 2016 H1 box office with 42.75 million yuan (1905 Movie Network data). 2) Production investment side: The company invests in the films “Escape from the Jedi”, “I Am Not Pan Jinlian”, and “Railroad Tiger” to be screened in the second half of the year and contribute revenue. Among them, “Escape from the Jedi” has already reached 800 million. Furthermore, the company plans to establish a film production company in cooperation with well-known overseas directors and producers, etc., and plans to launch 8-10 films over the next 5 years. 3) Entertainment agency side: The company signed a contract with the super popular idol Wu Yifan in June to fully represent domestic music, film and television, shows, commercial agents, etc.; Oriental Bentley cooperated with brands such as Issei Miyake and Dior to host high-end fashion events. At present, the company's film and television business has basically covered the main links in the film and television industry chain and is being improved. The film and television investment, production, screening, and brokerage business achieved revenue of 123 million, 469 million, and 62.09 million respectively, contributing nearly 77% of revenue. In the next step, it is expected that all links will continue to expand the scale and achieve collaboration. The game business is rich in reserves and is yet to explode. In the first half of the year, the company's online game business achieved revenue of 185 million yuan, and new games such as “Hot Blood Battle Song”, “The Legend of Tianmen”, and “Hero Domination” were launched; in addition, 6 games, including “Song of Beautiful Rivers and Mountains” and “Legendary Domination”, were prepared and will be launched in the second half of the year. In addition, Duwan Network formed teams in many places to acquire IP development rights such as Beautiful Jiangshan and Ghost Blowlight; acquired 70% of the shares in Free Galaxy through 190 million yuan to obtain the target company “Flower Thousand Bones”, “Legend of Qianyue”, “Legend of Qianyue”, and “Phantom City” and distribution resources for Tencent Gaming and WeChat platforms; by subscribing to Aimhigh to increase overseas distribution capabilities and target high-quality overseas movie game IPs. In the future, the company is expected to continue to integrate video game IP resources using Duplay Games and closely integrate with the film and television sector to enhance the company's overall competitive strength. Profit forecasting and investment proposals are optimistic about the company's development since its transformation in 2015. It is expected to reinvigorate the company's profitability and business scale while further exploring the content and channels of the entertainment industry chain, which is expected to form links and collaborate with each other in film, television, and games. Maintaining the original profit forecast, diluted with a share capital of 1,649 million, the 2016 to 2017 EPS was 0.34 and 0.43, respectively, corresponding to the stock price of 22.04 yuan on August 22. The 2016 PE-2017PE was 65 times and 51 times, respectively, maintaining the “increase” rating. There is a risk of policy changes; increased market competition; uncertainty about the benefits of cultural products; business integration falling short of expectations; and fluctuations caused by systematic market adjustments.