The company announced today that the Chengdu shopping mall project has introduced its partner Red Star Group. After the introduction, Xinhua Media, Australia-China International, and Red Star Group each own 40%, 15%, and 45% interests in the Chengdu shopping mall project. Red Star Group invested 570 million yuan in cash for this cooperation. This part of the capital was used to return part of the financial support previously provided to the project company by Xinhua Media and Australia-China International. The capital required for the resumption, construction and operation of subsequent projects was raised by Red Star Group and provided to the project company in the form of loans. Red Star Group is a private enterprise founded 24 years ago. It has set up 76 shopping malls in 58 cities in mainland China, with sales volume reaching 39.6 billion yuan in 2010. The main shopping mall format “Red Star Macalline” Home Furnishing Mall is the number one brand in the home distribution industry in China, and the group has good public relations, financing platforms and financing advantages. At present, the group has been involved in department stores, shopping centers and complex projects, and brought in overseas management groups and department store industry veterans. Furthermore, the group also has extensive experience in other real estate. Its subsidiary, Shanghai Red Star Macalline Real Estate Co., Ltd., is currently developing high-quality real estate projects in more than a dozen cities. According to the calculation of the Red Star Group's capital injection method, the Chengdu shopping plaza, which is currently closed, unfinished, and whose land use is “green space and storage,” has reached 1,267 billion yuan. There is still plenty of room for continued value addition after resuming construction and operation in the future. According to our analysis of surrounding land prices and property values, the project will be worth around 7 billion yuan after construction is completed. Red Star Group's intervention marks the determination of the main stores in Chengcheng Shopping Plaza. It will supplement ShoppingMall's investment and operation capabilities that were lacking in the project in the past, and the project financing capacity will also be greatly enhanced, making the certainty of the future value of the project significantly enhanced. The company's revenue in 2010, 2011 and 2012 is estimated to be 2.24 billion yuan, 2.36 billion yuan and 2.5 billion yuan respectively, and net profit attributable to the parent company is 230 million yuan, 260 million yuan and 270 million yuan respectively. The revenue and profit will all come from traditional business. According to an analysis of the company's historical valuation, the historical valuation of the traditional media sector, and the valuation level in 2010, the valuation range of 25 times to 34 times the company's traditional business was given, then the value range of the company's traditional business was 6.4 billion yuan to 8.7 billion yuan. Considering that the Chengcheng project can increase the internal value of Xinhua Media by about 2.2 billion yuan, the overall reasonable value range for Xinhua Media is 8.6 billion yuan to 10.9 billion yuan, and the equivalent reasonable value range per share is 8.23 yuan to 10.44 yuan. The current stock price is 8.31 yuan, which is at the lower end of the range, 26% from the upper limit, maintaining the “increase in holdings” rating. Risk warning: Traditional business fluctuates greatly; the land use for the Chengcheng project is “green space and storage.”