Interim results fell sharply year on year. During the reporting period, Huali Family achieved operating income of 14.2645 million yuan, a year-on-year decrease of 73.29%; net profit attributable to shareholders of listed companies was 6.2799 million yuan, a year-on-year decrease of 92.30%, achieving earnings per share of 0.01 yuan, and the company's interim results declined sharply. The reason for the sharp decline in the company's mid-term performance is that its decoration engineering business revenue fell sharply by 94.7%, but this is not the focus of the company's future contribution to performance. Future real estate revenue will dominate. After the project enters the settlement period, the company's performance will grow by leaps and bounds. Sales are heavily affected by policy regulation, and the company's projects are all high-end, targeting high-end improvement needs and investment needs. Therefore, they were greatly affected by policy regulation, and sales were slow during the reporting period. Profit forecast Due to performance promises, there is no need to worry about the company's 2010 performance of $0.96 per share. We expect the company's earnings per share from 2010 to 2012 to be $0.96, $1.25, and $1.65, respectively. Valuation and investment recommendations Relative valuation: The company's PE from 2010 to 2012 was 11.47 times, 8.82 times, and 6.70 times, respectively, and the company's relative valuation is relatively cheap. NAV valuation: After full land value-added tax, the company's NAV is 14.46 yuan/share. Currently, the stock price is discounted by 23.72%, which has a high margin of safety. Investment advice: We maintain the company's “buy” rating. Risk warning: Company capital chain risk, industry sales risk.