1. The event company announced that it intends to issue shares from the largest shareholder, Wuhan Hanyang District SASAC, to purchase the five cases of state-owned land use rights and its land attachments that it intends to inject. The estimated value of the underlying assets of this transaction is about 150 million yuan, and the issue price is 6.32 yuan per share. The State-owned assets Supervision and Administration Office of Hanyang District undertakes to obtain the ownership of the land use right and land attachments to be injected by January 16, 2010, and to make corresponding changes to the type and use of the land use right to make it meet the conditions for injection into the listed company for development and utilization; if the above relevant formalities are not completed at that time, it will bear a compensation of RMB 500000 to the company.

two。 Our analysis and judgment 1. Wuhan business competition is becoming increasingly fierce the company currently has three department stores, Hanyang Shopping Mall and 21 Shopping Center is located in Hanyang District, New Wuzhan Shopping Center is located in Hankou District. Hanyang Shopping Mall, with an operating area of 23000 square meters, is the oldest shopping mall in Hanyang District, and the Zhongjiacun business district is also the most important business area in Hanyang District. 21 Shopping Center is located in Wangjiawan Business District, Wuhan New area, with a total business area of 80,000 square meters. It is currently the largest shopping center in Wuhan New area. New Wuzhan Shopping Center is located in Hankou Wuguang Business District, that is, the core of Wuhan commerce, with a business area of 13000 square meters. It is the largest shopping mall in Wuhan featuring wearable and sports and leisure goods.

Although the company has a high brand image in Hanyang, the commercial competition in Wuhan is becoming increasingly fierce, and the company's advantages are not prominent: (1) the company's operating scale is relatively small, with a business income of only 593 million yuan in 2008. The operating income of Wuhan Zhongbai, Ewu Merchants and Wuhan Zhongshang was 8.649 billion yuan, 6.63 billion yuan and 3.161 billion yuan respectively. (2) there is a big gap in consumption scale and business atmosphere between Hanyang and Hankou and Wuchang. With the increasing commercial cohesion in Hankou and Wuchang, customers in Hanyang are constantly diverted. (3) in 2008, the company's sales expense rate, management expense rate and financial expense rate were 7.10%, 18.18% and 5.48%, respectively, which is much higher than the industry average. This is an important reason why the company has been losing operating profits in recent years. 2. Real estate has become the company's new business focus. As the only state-controlled retail listed company in Hanyang District, Han Shang Group takes real estate as the breakthrough of its business and strives to create a pattern of interactive development among the retail industry, the real estate industry and the convention and exhibition industry. The development of commercial real estate projects can not only alleviate the operating pressure caused by rising rents, but also obtain the benefits brought by property appreciation. The company has expanded two new shopping centers on the basis of Hanyang Mall and 21 Shopping Center, with a total floor area of 400000 square meters, in order to strengthen the company's business position in Zhongjiacun and Wangjiawan, the two main Hanyang business circles. The mall is expected to open in 2011. At present, Hanyang has become the target market for Wuhan commercial enterprises to expand. This asset injection shows the willingness of the Hanyang District Government to support the Han Merchants Group to become bigger and stronger. If the company can make full use of its location advantages and vigorously develop commercial real estate, it can seize the first opportunity in the commercial competition in Hanyang.

3. Investment suggestions We expect that the company's net profit in 2009-2011 will continue to be in a state of small profit, maintaining the company's "neutral" investment rating. As the company has not carried out asset evaluation and profit forecast for the target of this transaction, we do not adjust the expected results at present. With the continuous strengthening of the company's development of real estate business, the company is expected to get rid of the stagnant performance and give full play to the synergy between business and real estate, so as to share the opportunities brought by the future commercial development of Hanyang to a greater extent.