Semir clothing: multi-brand business model to protect the company growth
China's children's wear market: the star of the fast-growing future From the demand side, the children's wear market has enjoyed strong growth. Children's clothing represented by children's products market growth rate of more than 20%, brand consumption grew faster. China's unique "4 +2 +1" family structure significantly boost the consumption of baby products, and the forthcoming fourth baby boom makes the children's clothing market is expected to become a rapidly growing star of the future. From the supply side, children's wear in the first phase of development of the industry. And textile, casual men and other sub-sectors similar to children's wear market is extremely dispersed, the industry's first market share only low single digits. Volkswagen brand representatives Balabara and middle and high-end brand representatives Dr. Rana have a leading position in their respective segments, both of which can grow rapidly. At present, the best A-share investment for children's clothing is Semir and its subsidiary Barra Barra is the industry leader. With its brand and channel leading edge, it is expected to maintain a 40% compound growth and rebuild a Semir in the next 3-5 years. Paraballah's core competitiveness and development prospects: Paraballa is one of the brands of Semir Garments, the largest children's wear market in the country with extensive network coverage. Annual sales of more than 1.5 billion yuan, 2676 stores (125 Direct) extensive penetration of second and third tier cities. The average product selling price is about $ 70, and the product line is very rich. The market for children's apparel in the middle-aged and well-to-do families aged 3-12 is very competitive. Children's clothing market is decentralized, with huge growth space. Para-Barra is the largest in the industry, but its market share is only 1%. With its good brand awareness and high cost performance, Barra Barra is expected to grow rapidly in the mass market and lead the children's wear industry. Light asset management, rapid expansion. Barabara to take the production outsourcing + joining the main sales model, with adults installed Semir brand a strong background and supply chain system to achieve rapid growth, maintaining the shop and the double effect of improving. Brand goal The next four years to do 10 billion (retail terminals, equivalent to the company sales of 5 billion yuan, can be re-created a Semir), a compound annual growth rate of about 40%. The current sales volume of Barra Barre accounts for 1/4 of the total number of the company and will be the new growth driver of the company. Earnings Forecasts We expect Semir's EPS of 2.18 and 3.06 yuan respectively, up more than 40% over the same period of last year, of which Barra Barra accounts for 20% to 30% with a growth rate of about 50%. Valuation and recommendation: Maintain recommended rating. Since the listing of the company, the stock price adjustment is more obvious, the current valuation of 23.7x2011PE in the plate at a low, already have a better appeal. Semir and its Barra Barra brand are in line with the rapidly growing trend of mass consumption, sinking deeper into the channel and building barriers to entry with its logistics and scale advantages. Multi-brand business model for the company's sustainable growth has provided a guarantee, it is worth the valuation premium.
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