Langzi Shares (002612) Grew By 79%&Nbsp; The First Rating Was Overweight.

In 2011, the three quarterly EPS was 0.74 yuan, an increase of 78.5% over the same period last year, and its performance was in line with expectations.

This year, due to the adjustment of the scope of the report, the total profit and net profit increased by 39% and 37% respectively without considering the change of minority shareholders' rights and interests.

The company achieved operating income of 620 million yuan in 1-9 months, an increase of 59.1% over the same period last year, and realized operating profit of 170 million yuan, an increase of 38% over the same period last year. The net profit attributable to shareholders of listed companies was 147 million yuan, an increase of 78.5% over the previous year. The total diluted EPS was 0.74 yuan, and its performance accords with the growth range of 70%-80% in the previous three quarterly bulletin, which is slightly higher than our expected growth rate in the three quarterly forecast.

The company forecast 2011 net profit increased by 60-80% over the same period, that is, the corresponding annual report EPS is between 0.99-1.11 yuan.

The adjustment of the scope of statements makes the deduction of minority shareholders' profit and loss decrease, which is the main reason for the high growth of performance.

In November 25, 2010, the company completed a complete control of Hongkong's subsidiary's long dress and sun's clothing in Rhine, so that no minority interest was deducted this year, and 25 million 290 thousand minority interest was deducted in the first three quarters of last year.

The expansion of channels and the increase in popularity have brought about a rapid increase in revenue and a marked increase in gross profit margin.

In the first three quarters, the company's revenue grew by 59%, gross margin increased by 3.2 percentage points to 59.7%, but the cost increased rapidly. Among them, the sales cost increased by 1.8 percentage points to 17.3%, mainly due to the company's expansion of channels and advertising costs. The management fee rate increased by 5.3 percentage points to 14%, mainly due to the company's fashion week and the new brand's initial cost, that is, the increase in labor costs.

Net profit margin increased 2.6 percentage points to 23.7% in the first three quarters, but the net profit decreased by 3.9 percentage points after returning to the same base.

Brand cultivation ability is strong, new brand expands gradually.

Besides the three brands of "long Zi", "Rhine" and "Chao Ke", the company has nurtured two brands.

The new brand "Marian Mary", located in the little lady's dress (Figure 5), opened in Minsheng department store in Xi'an in September 20th. It occupies 90 square meters on the third floor of the shopping mall. It is expected that more stores will be opened in the year.

Leah's brand is a new brand created by the company to challenge the higher price of the main brand of the brand. At present, the brand is only sold in the shops, and there are no independent stores yet.

The company has high growth and the first rating increase.

The high-end women's clothing industry in the company can obviously benefit from the upgrading of consumption in the future. It will be gradually pmitted from one or two tier cities to three or four tier cities. But considering the large cost investment in recent years, we have slightly lowered 11-13 years EPS to 1.05/1.55/2.23 yuan (originally 1.1/1.59/2.28 yuan), corresponding to PE is 35/23/16 times, CAGR is 46%, growth is good, valuation is reasonable, and overweight rating.