YOUNGOR: Garment Industry Has Strategic Spanformation And Big Health Industry. Financial Venture Capital Has Become A Short-Term Driving Force.

　　 Event:

We participated in the YOUNGOR shareholders' meeting in March 23rd. We have conducted in-depth exchanges with the chairman of the board of directors, Li Rucheng, Liu Xinyu and other executives on a series of major issues such as the company's current business situation, the future strategic development direction and capital operation plan.

　 Main points of investment:

The future big health industry investment platform is clear about the direction of enterprise spanformation: in March 7th, the company announced that the company and its subsidiaries decided to invest 1 billion yuan and set up a health industry fund. The fund mainly focuses on the equity investment of the big health industry in the period of growth, expansion and maturity, with good prospects for industry development and enterprises with great value for mergers and acquisitions. It also pays attention to the opportunity for the excellent listed companies to increase, and the investment opportunities for the restructuring and regrouping of large and medium-sized mixed ownership in the health care industry. Company executives believe that the next outlet after the current wave of information technology is bound to be a big health industry. The establishment of this health industry fund is to prepare for the next round of spanformation of the company, and it is mentioned that the big health industry will be broad in scope, not in the narrow sense of medicine. The company has rich experience in equity investment, and has worked closely with many financial investment institutions.

　　 clothing Basically completed the bottoming, 15 years to maintain 10% growth: in 2014, the company's clothing business bottom up, 2015 target to maintain two digit growth. Company executives said they would not give up the main business of clothing. The main points for future development were: 1 Women's clothing brand Launch: 2015 spring will launch women's clothing business; 2) full channel architecture + membership system construction: the company will integrate existing entity stores, and has begun to increase online investment in the second half of 14 years. At present, Tmall, Jingdong and vip.com are on sale. In 2015, they will be stationed in shop 1 and Suning. They plan to withdraw their own business in 16 years, and the O2O sales mode will soon be ready. In the future, brand channel construction will develop to member development, and the company has 1 million 500 thousand members, and the future will reach 10 million.

Traditional property contraction, pension real estate investment direction in the future: with the company's idea of setting up a health industry fund corresponding, the future real estate business will also spanform to pension real estate. Due to the decline in real estate spanaction prices and changes in market supply and demand relationship, the real estate business will inevitably shrink, and gradually withdraw from the field projects to return to Ningbo. At the same time, the company is optimistic about the development prospects of pension real estate, and intends to spanform the real estate business in this direction. But at present, there are not many successful cases of the real estate for the aged, and the company is still investigating the project.

　 Financial investment Bring huge performance elasticity: 14 annual profit is expected to contribute 2 billion of profits (mainly Ningbo bank and CITIC Securities's one-time confirmation). It is estimated that the financial investment of the company will continue to contribute significantly in the next 15 years. As of December 31, 2014, the company's financial assets include Pudong Development Bank, Jin Zhengda, China Ping An, Guoxin Securities, and Guang Bo shares. Executives said that they would choose to implement cash in 15 years. The 15.7% of creative software will be restructured in the short term and 30% of the Chinese hemp industry. These will provide ample cash flow for the company's future strategic spanformation, and on the other hand, it will become a catalyst for the recent rise in the stock price of the company.

Earnings forecasts and investment recommendations: we expect the company's EPS for 2014-2015 years to be 1.35 yuan, 1.43 yuan, corresponding to 12.8 times and 12.28 times earnings ratio, and in the first quarter of 2015, 1 billion 100 million yuan of investment income is expected to be confirmed (Ningbo bank 600 million yuan + Textile City Land government repurchase 570 million), a quarterly report has exceeded expectations. We are optimistic about the spanformation layout of the company in the big health industry and financial investment in the future. We hope to realize the two spanformation of the big health platform + financial venture capital platform, and first buy the "buy" rating.

　　 Risk factors:

Health industry, pension real estate spanformation is not expected, financial investment target price volatility. Clothing industry Sales are below expectations.