Roley Home Textiles Will Carry Out 5 Strategic Changes In 2015 Or Continue To Grow Rapidly In The Future.

Net profit growth faster than revenue growth is mainly due to lower cost rate and gross margin. The former is mainly due to the dilution effect of accelerated revenue growth (2013 revenue is declining), while the latter is due to the improvement of supply chain, the decline in production procurement costs, and the growth of e-commerce channels. At the same time, the company's terminal inventory level has been reduced, and the inventory structure is more reasonable.

In response to changes in internal and external environment, the company will carry out 5 major strategic changes in 2015. 1) two wheel drive of industry and assets. Home textile home Transformation, wholesale to retail transformation, capital integration of home industry ecosystem quality resources; 2) try out the Luo Lai partnership system, each brand is transformed from the Department to a subsidiary company, the sub general manager holds the company stock, establishes the internal market mechanism; 3) takes the LOVO brand as the foundation, and other brands rhythmically import the line, creates the group vertical household. Electronic business platform (4) the new mode of Lok's home has good sales effect in the Zhongsheng shopping center, and will actively layout the low-end market in the future. 5) do well the strategic talent reserve to meet the needs of talents at all levels. Although the final effect remains to be seen, we are optimistic about this.

Luo Lai Home textiles Optimistic about the company's performance in 2015 will continue to maintain rapid growth. If we exclude the influence of dealers in the integrated part of the region, we expect that the main brand of the company will continue to grow more than two digits in spring and summer in 2015, and will further open up the growth space of the brand (10 in 2014 and 10 in 2015). Secondly, the children's product category extension will lead to the development of children's home Museum in the future, and the franchisee's recognition will be higher. It is expected that the order will increase faster than the Luo Lai brand. Third, the LOVO brand will continue to maintain a high growth rate in 2015. Fourth, the new model shop of Le Yue's new model store has a good sales situation. If it goes smoothly, 50-60 new stores and fifth will be opened this year. First

Financial forecast and investment advice.

We expect the company's earnings per share for 2014-2016 years to be 1.42, 1.69 and 2.06 yuan (originally forecast for 1.37, 1.61 and 1.96 yuan), referring to the average valuation of the comparable companies, especially the two domestic textile listed companies in 15 years, maintaining the company's 15 year PE valuation 20 times, the target price 33.80 yuan, and maintaining the buying rating.

Risk warning.

The risk of domestic economic downturn, the risk of terminal inventory backlog.