Nine Mu Wang: Capital Raising Subsidiary To Build Overseas Investment Entities

100 million US dollars to increase Hongkong's wholly-owned subsidiary to build overseas investment entities.

The company announced in March 28th that it would use its own capital of 100 million US dollars to replenishment of Cci Capital Ltd, a wholly owned subsidiary.

On the one hand, retail will be the main body of overseas investment, optimize the investment structure of the company and promote the realization of the company strategy; on the other hand, it will strengthen the linkage and cooperation with the international fashion industry, and provide support for the company to build an international brand operation platform, improve brand operation ability and commodity research and development capability.

In response to challenges, the company has actively explored and made active changes in recent years.

1) in order to cope with the decline, we should actively explore the pformation of franchising business besides commodity management and retail management. 2) integrate the online and offline integration as an important strategic development direction in the future, and start the O2O project in 14 years. 3) respond to the change of consumer demand, further carding the clear commodity strategy, introducing the commodity planning system and process to achieve the full value chain management of commodities.

The company's recent performance is steadily improving, and it is expected to rebound in the next 15 years.

In the 14 quarter of spring, summer and autumn and winter, the sale rate of goods in the two quarter of the company is expected to be slightly better than 13 years, and the terminal inventory pressure has gradually improved. The same store is expected to continue to maintain a digit growth rate from the beginning of the year to date, although the shipment is subject to 15 years' spring and summer ordering.

The impact of the downturn, but we expect the recent 15 years of autumn and winter orders will be expected to achieve positive growth in volume, so the second half of the alliance shipments are expected to improve.

We are optimistic about the future landing of the company in merger and consolidation.

Although the company terminated the framework agreement with Lang Ken in 14 October, at the same time, it invested 800 million in the establishment of a wholly owned subsidiary in Tibet to manage the company's assets and capital operation. The subsidiary invested 200 million shares in the financial sector in the following month, plus the recent increase in capital. We are optimistic about the company's future merger and consolidation projects.

Financial forecast and investment advice.

We expect the company to share 14-16 years

They were 0.74, 0.83 and 0.97 yuan (2015 and 2016 respectively, 0.88 yuan and 1.08 yuan respectively), referring to the PE valuation level of 36 times the 15 year average of the comparable company, taking into account the fact that the company has not yet established the industry fund or the merger and acquisition integration behavior as the other higher valued companies. Therefore, the company gives the average 25% discount of the industry, giving the company 15 times 27 times PE, the target price 22.41 yuan, and maintaining the overweight rating.