This report is read as follows:

We believe that the company is expected to gradually straighten out the governance mechanism, the first brand of the floor is expected to stimulate new vitality and maintain the "holding" rating.

Main points of investment:

Maintain the "overweight" rating. We believe that the company is expected to gradually straighten out the management mechanism, the first floor brand is expected to stimulate new vitality. We maintain the EPS of 1.25,1.47,1.66 yuan in 2021-2023, maintain the target price of 22.05 yuan, and maintain the "overweight" rating.

The governance mechanism is expected to be further straightened out. We think that Mr. Chen Jianjun will succeed as the chairman of the company and the control of the company is solid. Recently, it was announced that Mr. Wu Guhua returned to the proposed president and secretary, or officially announced the beginning of a new era for a new generation of senior management team. we refer to the fact that Mr. Wu Guhua promoted the first equity incentive for middle and senior managers under the leadership of Mr. Chen Jianjun from 2016 to 2018, during which the company's operation and management was further optimized, greatly exceeding the benchmark growth rate. It fully shows the important role of the new generation of management team in promoting the development of the company.

The advantages of leading brands are highlighted, and the beneficiary population is "aging". We believe that benefiting from the aging population and the upgrading of flooring products, the floor is expected to be more favored by consumers by virtue of more warm, environmental protection and other features. And horizontal comparison of the floor industry, Daya Sheng Elephant market share of more than 13% (market share far ahead of the second), from the brand, channels, premium capacity and other aspects are far ahead of their peers, the leading advantage is prominent.

We will continue to deepen the layout of C-end, and the market share of B-end will increase steadily. We believe that the company may continue to increase the retail channel layout and product upgrading, which is expected to achieve the strong; while the tooling channel, benefiting from the increase in the proportion of hardcover rooms, Daya Holy Elephant is expected to rely on its own brand and scale advantages, occupy the best quality customer resources in the hardcover housing market, and continue to achieve steady growth.

Risk tips: real estate investment decline risk, raw material shortage and cost rising risk