We had a detailed exchange with the company at the strategic meeting of China Merchants Securities 2011, and the company's

Commentary:

1, integrate capital advantages to increase supplier support and increase procurement and production in advance.

In recent years, the rising cost of raw materials and labor has greatly increased the pressure of upstream suppliers. Labor shortage has further increased the uncertainty of production. The company believes that in such a period, it is a common development need to make full use of its own financial resources and give high-quality suppliers support.

2, integrate capital advantages to support high-quality franchisees, and join the business to restore strong momentum of development.

In order to better mobilize the enthusiasm of franchisees and make up for not creating more value for franchisees in the previous two years, the company adopted a series of support policies this year.

It includes prop support, advertising support, moderate return and so on.

3, state purchase formally launched, and most of the

With the change of consumption demand, especially the consumption habits of the younger generation, e-commerce has become a major trend in the clothing industry.

4. Profit forecasts and investment proposals

We have always maintained that the company is the leading and innovative leading leisure wear brand in the domestic development mode.

Although the promotion process of MC new brand is constantly twists and turns, but the company's timely correction and improvement has gained new opportunities for development.

Since the three quarter, since the company's performance has improved, we have always believed that the company's investment opportunities based on fundamentals have just begun, thereby giving continuous recommendations to the company.

In 2011, the company will actively play the role of resource integrator, actively promote the rapid growth of franchise business, and continue to improve the efficiency through a series of measures. MB will achieve sustained and healthy growth. It is a solid guarantee for sustained and rapid growth of performance. A stable investment strategy for MC development is a further guarantee for rapid development. Meanwhile, the development of BPO will open up a new space for the development of the company and become a platform for integrating online and offline businesses.

We continue to increase the EPS for 10-12 years from 0.76, 1.15 and 1.55 yuan / share to 0.76, 1.21 and 1.62 yuan / share.

At present, the valuation is 10 and 11 years 45 and 28 times, the half year target price can be 11 times 35 times PE as the center, the half year's reasonable value is 42.18 yuan. In the early stage of gradual improvement, we have always suggested that we should actively pay attention to and maintain "strongly recommend -A".

Risk factors: the impact of economic recovery on consumption is lower than expected; affiliation expansion is lower than expected; MC brand development is lower than expected; cost rate control is lower than expected.