The main points of investment are 300-year-old brands with a variety of varieties. The predecessor of Jiuzhitang, “Laojiu Zhitang Pharmacy,” was founded in 1650 and has a history of more than 300 years. It is a famous long-established brand in China and has high brand value. There is a saying that “there is Tong Ren Tang in the north, and Jiu Zhitang in the south.” First-tier varieties provide a margin of safety and form the main support for performance. The company's first-line products are donkey gum blood supplement granules and concentrated pills, which have a certain market position and popularity in the market, especially in the southern market. The sales volume of these two types of products has been relatively stable, becoming the main source of operating income, providing the company with a reliable margin of safety. The concentrated pill series is represented by Liuwei Dihuang pills. Market demand is broad, and sales growth is steady. With the streamlining of the marketing system, sales of donkey gum blood supplement pellets are expected to increase significantly. When Cheng Jizhong takes office, the marketing system may usher in major changes. Cheng Jizhong, the former marketing director of Donga Ejiao, became the general manager. General Manager Cheng has 23 years of experience in pharmaceutical sales and commercial channel management, and is the founder of the “controlled marketing” theory. He has deep experience and rich operational experience in prescription drugs, OTC market management, third terminal operation practices, overall marketing planning, detailed management and method innovation in remuneration assessment, and commercial channel policy formulation. We expect that with the arrival of General Manager Cheng, the company's marketing system will be expected to undergo qualitative changes. Efforts to cultivate second-tier varieties will be stepped up, and new breakthroughs are expected in performance. In order to further consolidate and enhance its performance, the company has stepped up efforts to cultivate second-tier varieties. Currently, it has adopted a development policy of “stabilizing the middle, breaking through two wings.” Second-tier products may become the company's key breakthrough direction in the future. Financial and valuation. According to our profit forecast, the company's EPS for 2012-2014 is expected to be 0.68 yuan, 0.84 yuan, and 0.92 yuan respectively. Considering the changes in the company's future marketing system that may cause significant growth in the company's products, we gave the company a PE valuation of 26 times over 12 years, corresponding to the target price of 17.71 yuan, giving the company an “increase in holdings” rating for the first time. Risk warning 1) The marketing reform fell short of expectations 2) Mr. Cheng and his team did not get along well.