Earnings expected to have increased 219.64% YoYThe company gave a 2016 earnings briefing, with revenue andprofit in line with expectations: revenue +24.13% YoY toRmb2.563bn, net profit attributable to shareholders +219.64%YoY to Rmb234mn. Benefiting from the transformation towardautomotive spare parts business and consolidation of UMF, netprofit increased significantly.

Trends to watch

Growth of Fin-Tech businesses such as payment and bigdata picking up speed.

Traditional business structure optimized; profitabilityimproving.

Valuation and recommendation

We remain upbeat on the company's deployment in internetfinance and progress in big data service. Maintain BUY and TPof Rmb36.18. We remain upbeat on the rapid growth of thethird party payment industry and the company's deployment inpayment, big data and block chains. We slightly raise ourearnings forecast and expect 2016/17/18e net profit attributableto shareholders to be Rmb234mn/456mn/580mn with fullydiluted EPS of Rmb0.41/0.80/1.02 （revised up by5.96%/2.99%/2.59%）。 The current stock price is 73x/37x/29x2016/17/18e P/E.

Risks

Internet finance business disappoints; operator reform disruptsinformation service and fee settlement business.