Securities Promotion: Special step growth potential

The shares of state-Hao Capital, the International (1368), fell 7% in Thursday, three minutes before the close of yesterday, with a fall of 16% to 3.00 yuan. The company has not announced any major issues. The basic factors of the company did not change in the June. 　　Special step June Same-store sales growth for high single-digit, better than the 4 May median single-digit. Shop network all over the country according to Frost &sullivan Survey, Special Step International is the mainland's 3rd largest sportswear brand, 2008 market share of 4.9%. The bank believes that special step international growth potential, mainly because of its network across the country and focus on fashion sportswear. 　　According to Euromonitor forecast, 2007 China's fashion sportswear accounted for the overall market share of sports apparel 17%, is expected to rise to 27% in 2012. At present, the number of brand stores has grown from 5,056 at the end of 2008 to the current 5,300. Most of the international stores are located in the lower-line cities, consumption is more exuberant. Fashion sportswear brands do not need to compete for costly sponsorship, which will reduce their advertising and marketing costs, thereby boosting their profitability. 　　2008, the special step operating profit margin of 20.6%, and its similar size but focus on functional sportswear 361 degrees (1361), the operating profit margin of 18.3% in 9 months until March 31, 2009. The bank maintained a profit of 0.27 RMB, 0.32 yuan and 0.38 yuan per share from 2009 to 2011 respectively. The current stock price is equivalent to 10.9 times times 2009 P/E and 9.2 times times 2010 P/E. 　　Considering that the compound growth rate of earnings per share will reach 18% between 2009 and 2011, the bank believes the current valuation is attractive. reiterated the Buy rating, the target price unchanged, still 4.19 yuan (yesterday received 3.65 yuan), equivalent to 13.5 times times the 2009 P/E ratio.