Investment suggestion: we expect the company's EPS from 2014 to 2016 to be-0.05,0.14 and 0.24 yuan respectively, taking into account the great improvement in the company's management structure, strategic direction and major shareholder support from 2013 to 2014, and relying on the company's strong brand precipitation and influence, with the implementation of a series of measures of product adjustment and market repositioning. The sales scale and market share of Zanthoxylum nitidum toothpaste are expected to improve significantly from 2015. In addition, we judge that the reasonable valuation level of the value of the company's assets is about 3.6 billion yuan, which is higher than the current market value level. With reference to the reasonable asset value of the company, the corresponding target price is 8 yuan, and the "overweight" rating is given for the first time.

The history of Zanthoxylum nitidum is brilliant, and the residual power of brand influence is still there. Although under the objective impact of foreign brands entering China, the company's market share has shrunk significantly due to the lack of timely adjustment of product positioning and marketing strategies. However, because of its long brand glorious history, Zanthoxylum nitidum still has strong brand recognition and market influence. Through effective market investment and product positioning adjustment in the future, we judge that the company's products are expected to return to public vision and be accepted by the market.

In the year of metamorphosis from 2013 to 2014, the two-sided needle has been dormant for a long time. We believe that the transformation of the company began in 2013 after years of dormancy of the two-sided needle. From 2013 to 2014, with the strategic planning adjustment of the new chairman and the full support of major shareholders, Zanthoxylum nitidum relies on its inherent brand accumulation and market influence, with the help of new product development and the adjustment and improvement of original products at the same time re-sales network construction and brand communication, a series of measures will help the sales scale and market share of Zanthoxylum nitidum products return to a reasonable level, and the effect is expected to be reflected from 2015.

Risk hint: the market effect of the company's new products is not as expected, and sucralose business continues to decline.