Tianhong Shopping Center: strong profitability and rapid expansion

Sina tip: This article belongs to the Research Report column, only for the analysis of a stock of personal views and views, and the unofficial news report, Sina does not guarantee its authenticity and objectivity, all relevant to the stock of effective information to the Shanghai and Shenzhen Stock Exchange of the announcement as prevail, please investors pay attention to risk. Company profile: Shenzhen and Guangdong region are the highest sales, stores the largest number of department stores chain Enterprises. As of April 2010, the company in Shenzhen, Xiamen, Nanchang, and other open 37 direct shopping malls and 3 franchise stores, 9 consecutive years into the Chinese chain Hundred Enterprises (2009 column 33).　　The main income from Shenzhen (2009 sales accounted for 69.94%), established a "base on the Pearl River delta, Radiation min Triangle, expand the Yangtze River delta" development strategy. Company Investment Highlights: (1) Clear positioning. Company "department Stores + supermarket +x" mode of combination, will be a supermarket to create a shared customer base with the exquisite supermarket, enhanced the synergy effect of the industry, effectively attract passenger flow growth. (2) Management of high efficiency and refinement. The company is an early entry into the outstanding performance management model, Lean Six Sigma (LSS), Balanced Scorecard (BSC) of the retail enterprises, management can continue to innovate. In the past 3 years, the company's comprehensive gross profit and net interest rate of 31.03%, 4.82%, obviously higher than the industry average, showing the company's outstanding management and implementation capabilities. (3) The incentive mechanism is in place.　　Company 115 management through the holding can come to the company, Orr Company, Kangda company, thereby indirectly holding the company after the issuance of 7.95% equity, which is conducive to the improvement of corporate governance and the release of performance. Earnings forecasts and company valuations: the company's net profit growth rate of 41% in the past 5 years, the next 2-3 years, the company's stores will expand faster, 2010 is expected to open a new store 8 (has opened 3), after the average annual opening shop in 8-10. According to the issuance of equity 400.1 million shares, the forecast company 2010-2012 EPS for 1.24 yuan, 1.62 yuan, 2.11 yuan. Considering comparable companies and the valuation of the SME, we recommend the inquiry interval of 37.2-43.4 yuan, equivalent to 2010 30-35 times PE.