BELLE Shoe Industry: Dot Gain Has Quick Advantages.

The decline of the periphery dragged the Hong Kong stock down, and the Hang Seng index opened 280 points. After that, it fell to 21099 after 21684, slightly rebounded in the afternoon, closed at 21220 points, and hit 692 points, with a turnover of 63 billion 700 million yuan.

The problem of financial institutions remains unsolved, which still plagued the performance of US stocks. In addition, this week, the US has more business performance announcements, and the big market selling pressure continues. It is estimated that the Hang Seng index will still be repeatedly bottoming out, and it will not rule out the 20573 low in March.

At present, investors' investment confidence is still lacking. Just now, the technology oversold shares have rebounded.

However, in the fluctuating market, the domestic demand shares can play a defensive role. Among them, BELLE (1880) shares have a strong indication of bottoming, and 6.8 yuan is obviously supported. Yesterday's highest recovery was 7.38 yuan (close to 20 antennas), which could be noticed.

BELLE is recognized as the largest retail outlet for women's shoes in the mainland, including its own brand "Belle" and "Staccato", as well as BELLE's "Joy&Peace".

As a matter of fact, the sales target of BELLE is concentrated on customers with high consumption power. Therefore, it has higher bargaining power and stronger product price resilience. Multi brand business strategy effectively disperses the risk of a single brand. Its huge distribution and retail network and vertically integrated business mode are also competitive advantages and market selling points, at least effectively controlling logistics costs and giving full play to the advantages of business scale.

Department stores increased to 9000

BELLE has announced a number of acquisitions since last year. The projects of MII Li, Jiangsu, Santa Fe and Mei Po will be paid for this year if they are implemented on schedule, at least 4 billion yuan.

BELLE increased 2280 retail outlets last year, including M & A projects. Its number of outlets will be as high as 9000. In addition to expanding the brand portfolio and reducing operational risks, it will also expand the men's shoes and casual wear shoes, and further occupy the middle and high-end footwear market. The new business can expand faster after Maori's orbit, and can provide an excuse for speculation in the market.

Beijing Olympic Games has entered the last month of the countdown, the Olympic atmosphere is rising, the sporting goods unit is also eager to move. In fact, BELLE is also a larger retailer of the mainland sports apparel. It definitely has the concept of Beijing's 08 year Olympic Games. It is the largest retailer of the Nike and Adidas two inter city sports apparel brands in the mainland.

The gross profit of the sportswear retail business of the group is relatively low, but the income of the business has increased by 96% over the past year, of which the income from the first-line brand has increased by nearly 73% annually, while the income from second-line brand has increased by more than 10 times year by year.

Management expects that with the continuous increase in the proportion of second-line brand outlets and revenue, it can drive its growth in the same store sales of sporting goods at 20% level, and grow faster than similar data, and at the same time, it can also drive the group's overall revenue and earnings to continue to grow.

According to the degree of strong consumption in the mainland, BELLE's business progress is in line with expectations. The market expects that the compound annual growth rate of net profit in the 07 to 09 years will reach 38%, and the 08 year forecast price earnings ratio is only 22.5 times, and the current price is already in a serious oversold area. Therefore, we should consider taking advantage of the low collection and the middle line can still be optimistic. The first rebound target price is 8.3 yuan, and it falls below 6.8 yuan (the current price is 7.05 yuan).

XTEP optimistic about profit growth

In 8 to 10 years, the annual growth of XTEP shoes and clothing sales increased by 32% and 34% respectively, while the average unit price increased by at least 3% per year, leading to a 42% increase in net income and net profit.

At present, the stock is only trading at 11.1 times and 7.6 times the forecast price earnings ratio of 08 years and 09 years, compared with 34% and 38% of the same trade.

XTEP's "overweight" rating is now issued at a target price of 4.3 yuan.