Blue Chip: Buying Korean Children'S Clothing Or Catalyzing Short-Term Stock Price Performance

The wholly owned subsidiary has signed the equity pfer agreement with the largest shareholder of Akbar, a Korean listed company. Taking into account the high share and popularity of aka state in Korea, it shows that it has strong brand and product strength. Although the profit performance is not ideal, the children's market in our country is relatively fragmented, especially in the department stores and MALL channels.

Of course, it is very important to improve operation after takeover. The company is still planning.

On the whole, the main business of women's clothing is expected to perform normally this year. At present, it is 32 times higher than 14 years, but its valuation is rather high, but short term foreign investment and "goddess's new clothes" have some stimulation on stock prices.

Opportunities for long-term fundamentals still depend on the improvement of women's clothing industry, and whether the company can make a contribution in the newly acquired children's field. The recent strategic positioning adjustment of the company is an important change in the future development plan.

The "equity pfer agreement" signed successfully became the first circulation shareholder of Akbar, a listed company of Korean baby products, and will continue to participate in the subscription.

Today, the company announced the signing of the equity pfer agreement and the memorandum of participation in the Rhine stock exchange, a wholly owned subsidiary of South Korea, and the largest shareholder of Akbar, a Korean listed company, and made an asset settlement in Seoul, South Korea in December 4th.

This investment, South Korea, has bought 4 million 272 thousand shares of Akabon, the largest shareholder of South Korea's stock exchange, and 15.257% shares of the total capital stock of the AAA group, with a price of 32 billion 40 million won (about 180 million yuan), and intends to take part in the 4 million 200 thousand shares of Akabon's subsequent private placement, with a total price of 21 billion 420 million won (about 120 million yuan).

After the completion of the fixed increase, South Korea will hold 8 million 472 thousand shares of akakon company, which will account for 25.86% of the total share capital issued by Akbar.

Set foot in the new field of children's products, or bring new business opportunities to the posture.

It was revealed that Akbar was founded in 1979 and listed in Korea in 2002.

The first company specializes in infant clothing and supplies, mainly 0-4 years old baby clothing, baby products, skin care products, toys and other children's growth products, has a total of 5 series of brands, currently has 750 stores in South Korea, 13 years in the Korean market, the total occupancy rate is 16%, ranking second.

In 1996, the Yantai aka bond company was established in China, responsible for the business development in China. Until now, Akbar has more than 80 stores in China.

Overall, according to China's accounting standards and the existing accounting policies of the company, aka's net assets of unaudited 13 in December 30th were 854 million yuan, and the company's acquisition of its 15.257% stake was about 130 million yuan. The total operating income in the 13 and 14 years was 1 billion 123 million yuan and 416 million yuan respectively, while the net profit for the same period was 3 million 420 thousand yuan and -4386 yuan respectively.

At present, the butting of the business teams between the two sides has not yet been completed. Judging from the existing operation of aka bond, the income and net profit in the first half of this year have all declined, and the two indexes of the whole year are all down, but the company expects that the rate of decline will not be particularly large, and the net profit margin in the second half of this year is less than the first half.

The company believes that Akabon's profit loss this year is expected to be mainly due to the fierce competition in the Korean market and the impact of the pfer of major shareholders on the enthusiasm of executives and employees.

Although the performance of the current profits is not good, it can not be thickened in the short term, but the management efficiency of aka state management is not inferior to that of LAN Zi, and the staff loyalty is relatively high. The income scale of 1 billion 100 million yuan indicates its market position in the Korean children's market. Because of its leading brand and product strength in the Korean market, it can lay a good foundation for developing the Chinese children's market.

At the same time, China's children's market is still scattered. The first brand is only 3% of the market, and the competition environment is relatively relaxed, especially in department stores and MALL channels.

There are still opportunities for development of brands.

Early akakon lacks operational experience in the Chinese market, and its operation performance is not outstanding. But langzi is familiar with the Chinese market, with its channel resources and financial support in China, akakang children's business will develop faster in the Chinese market in the future, and it can also improve langzi's multi brand structure layout.

Of course, it is very important to improve the operation after the acquisition. Now that the company has not yet completed the docking with Akabon, the company's business team will also go to Korea for docking, so the follow-up operation improvement plan is still under planning.

We will continue to follow up the follow-up.

Strategic positioning adjustment, plan to expand the scope of the target group to the field of popular fashion.

At present, the company is formulating the development strategy for the next 3-5 years, and plans to extend the original high-end women's clothing to the field of mass fashion.

The company's recent strategic positioning adjustment is an important change in the future development plan.

The future is mainly aimed at adjusting the following aspects: 1) the two brands of Rhine and Marian Mary will be adjusted to a more popular style. It is expected that the intensity of adjustment will further increase in Rhine next year, and the expansion rate of stores will also be improved.

2) the goddess's new clothes show great inspiration for the company's later strategic positioning.

First of all, in the supply chain improvement, the company has been looking for improvement in response speed, but the effect has not been ideal. But the goddess's new clothes program can make products from design to sale to be completed in about 20 days. Therefore, Future Ltd plans to make a small-scale attempt in its own brand, reducing the first volume and improving the speed of tracking.

In addition, in terms of design, the company will actively cooperate with designers. The first step is to strengthen cooperation with Zhang Xinyu's designers in the brand of Marian Mary. In the future, we hope to cooperate with more designers who are welcomed by young people and promote the brand positioning on the basis of providing development platform for designers.

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3) the company will continue to pay attention to the integration of the industry chain. In order to meet the needs of 80, 90 and 00, Future Ltd will focus on the continuous integration of fashion and public products, thereby enhancing the brand influence of young people.

4) expand the customers of fashion industry.

The VIP company has strong customer system maintenance and tracking capabilities, and plans to further extend its customers to the fashion industry in the later stage.

Earnings forecasts and investment recommendations: in the context of a continuous downturn in the retail environment, the growth of the same store is slowing down and the expansion is slowing down, resulting in a decline in company revenue and cost control is still a pressing problem for the company.

Overall, this year, in the context of continued downturn in department stores, it is expected that the company's annual sales will be affected, and in the case of no sign of improvement in the cost, the annual performance is expected to be general, but the profit base will decrease in the second half of the year, and the fourth quarter will be narrowed or narrowed.

Considering that the thickening of foreign investment performance is not obvious (children's wear development planning has not yet been introduced, earnings forecast has not taken into account the future contribution of children's clothing business), we have basically maintained a 14-16 year EPS 0.71, 0.86 and 0.99 yuan per share, which are currently 32 times as high as 14 years, but the short-term foreign investment involved in children's business or stimulated the return of stock prices, bringing certain trading opportunities.

Maintain "prudent recommendation -A" investment rating.

In the long run, the development of middle and high end women's clothing is different from other categories of domestic brand clothing. The development genes determine that the base of brand management in this field is still stronger than that of other categories. Under the weak environment, the company is also actively reorganizing, so that the follow-up results can be observed.

At the same time, the acquisition of the brand of children's products, which is quite basic in South Korea, has certain opportunities for development at the present stage of China's development. The follow-up operation of sustainable observation companies in this field will bring more long-term investment opportunities if there is a success.

Risk warning: 1) the risk of new planning implementation is not as good as expected; 2) the risk of excessive investment and increased inventory caused by multi brand development; 3) the risk of children's business development is not as good as expected; 4) the risk of large shareholder reduction in September 14.