Textile And Clothing: Outdoor Products Industry Is Limitless In Dangerous Peak.

The proportion of traditional consumer goods has decreased year by year, and the demand for entertainment, education culture, pportation and communication has increased rapidly, which fully reflects the increasing inclination of residents to personal development and enjoying consumption.

Over the past five years, the number of cars has risen rapidly. Especially, the fastest growth of SUV models, the distance between people and outdoor destinations will be greatly reduced, and outdoor sports will be steadily promoted with the increase of car ownership.

Outdoor sports enthusiasts are characterized by high academic qualifications and high income. The number of outdoor participants and professional organizations is increasing. The network platform provides powerful convening and organizing functions, laying a good mass foundation for outdoor sports promotion.

A wide and diverse geographical environment has created a wealth of outdoor sports resources.

In 2010, the retail sales of outdoor products exceeded 7 billion yuan, and maintained a 40% growth rate in recent years, becoming one of the fastest growing segments of the retail sector.

The sales volume of outdoor sporting goods for key large retail enterprises increased by more than 15.6% of sporting goods. The proportion of outdoor sporting goods in the retail sales of sporting goods increased from 13.8% to 19.9%. Outdoor products are more professional and functional than ordinary sporting goods, and consumers are willing to pay higher prices for them.

We think that outdoor products have taken the baton of traditional sports products.

Internationally renowned brands are actively investing in the domestic market, reflecting the bright prospects for the outdoor goods market.

Local brands have improved significantly in the market share of sportswear and footwear by virtue of cost-effective performance, wider product lines and marketing channels all over the country. Local brands can also squeeze into the top three in the first and second tier cities, indicating that they are already competitive. With the improvement of the awareness of local brands in the two or three line market, there is still room for expansion.

Safety and comfort are the labels of outdoor products. We must master core technology and design capabilities and create brand technology selling points to ensure the sustainable development of outdoor enterprises.

In the fast growing stage, channel expansion is very important. Retail stores are an important window to promote outdoor culture and cultivate consumers. Shopping malls are still the focus in the short term, and the potential of professional outdoor stores is larger in the long run.

The coverage of second tier cities needs to be improved. This year's important task is to do well in channel sinking. We believe that speeding up the layout of the second tier market is in line with the positioning of the company's outdoor brand.

As a local brand, we have a better understanding of the needs of domestic consumers. The size and design of products are more suitable for the domestic market, and we hope to go faster after landing in the capital market.

Forecast 2011-2012 operating income was 745 million yuan and 1 billion yuan respectively, the growth rate was 72% and 34% respectively, EPS was 0.34 yuan and 0.47 yuan, giving the "short-term recommendation, long-term _A" rating.

To provide products with independent intellectual property rights to well-known outdoor sports brands, its own outdoor brand Kroceus business will accelerate this year.

We believe that the company, as the core technology of fabric, has already been on the top of the outdoor industry. Once the brand is mature, it will hopefully occupy a place in the industry.

Breakthroughs in new fabrics will become a catalyst to enhance the company's valuation level.

Without considering the continued expansion of capital raising capacity, we predict that the 2011-2012 annual revenue growth rate is 16.1% and 47.2%, respectively. EPS is 0.43 and 0.62 yuan respectively, giving the "short-term recommendation, long-term _A" rating.