Smith Barney officially promotes 2011 children's wear brand price competition Barabara

Metersbonwe will formally launch the Smithsonian brand of children's wear next spring, which is similar in price to Balabara and lower than MCKids. There is a big difference in the design style between the new children's wear brand and the MCkids. MCkids is mainly a wave boy and its style is adult. The company’s new children’s wear brand is based on cute, childlike fashion, and apparel promotes “imaginative” new children's clothing store expansion. It mainly relies on the company’s existing relatively mature direct sales stores. The company now has about 600 MB direct sales stores. , is conducive to the rapid expansion of the new children's wear brand. We believe that the children's wear industry has little brand competition pressure, high gross profit margin, and good prospects for future development!

The urban series was launched in 2011, and the brand image was continuously improved and the brand was upgraded.

The company's winter 2011 collection, urban series (Lin Zhiling endorsement series), in the product's style, material, design and development, the sense of flatness are all international big standard. Urban series is a relatively independent series of MB. With its launch, the company hopes to spread a message to the market and the company's brand image is upgrading. This is also a way to tie in with the company's brand to enter the mainstream business district.

With the development of the company's brand, the rich brand series will cover more consumer groups for the company. The Chinese market is more differentiated, and only rich series can introduce matching products in different regions.

Through the efforts of the company for half a year, in the third quarter of the company, only about 30% of inventory was inventory in 2010 (that is, about 900 million). We believe that in the fourth quarter of this year, the number of inventories for 2010 will be substantially reduced in the sales of winter clothes, and can be almost digested in the first quarter or the first half of next year. The company now has more than 200 discount stores, including more than 100 direct sales stores. In addition to discount channel sales, the company's 2010 winter products will be combined with new products and sales, and will also be digested through large-scale sales.

The company has more than 2,000 franchisees and more than 3,600 franchise stores. The company's franchisee model is flat, and channel inventory is capable of compressing goods. The pressure of different business model inventory is certainly not the same. The proportion of direct operations of Smith Barney is relatively high, and inventory pressure can be self-digested. The company believes that the high growth in previous years will inevitably bring about problems, and the problems will gradually be exposed. Now that the growth rate has declined, the company needs to slowly sort out the problems and improve itself continuously.

MC has developed steadily and profitability is the first goal.

There are more than 500 MC stores in the company, of which more than 200 children's wear, more than 200 adults, MC's current efficiency is more than 10,000, a substantial investment in the early stage, and is still at a loss. After the MC2008 was launched, it continued to lose money, and the company continued to summarize progress in its development. From radical expansion to stable development now. The development focus has shifted from outreach to endogenous growth. The purpose is very clear. For the purpose of profit, the cost expenditure will also be for profit, for example, advertising expenditure will be reduced. MC's expansion will not be fast next year, mainly to solve its own problems of profitability.

Valuation and investment advice

We expect the company's 2011-13 EPS to be 1.19 yuan, 1.58 yuan and 1.97 yuan respectively, and the corresponding price-earnings ratio will be 25 times, 19 times, and 15 times. The company is an excellent leisure apparel company with ideas and imagination. We are optimistic about the long-term development of the company, giving 25 times the target price-earnings ratio for 2012, 12-month target price of 39 yuan, giving the company a "buy" rating. Key concerns Share price catalyst: The children's wear and metropolitan series under the company's flagship were successfully launched and inventory processing was faster than expected.