Incident description The company specializes in clothing, silk products, cocoon products, printing and dyeing processing, hardware products, etc., and is one of the largest silk product production and sales enterprises in China. It has a complete industrial chain from cocoon drying to cocoon silk weaving, printing and dyeing, and garment manufacturing; the company has been operating in the silk industry for more than 30 years, has acquired the silk industry Internet information platform “Golden Silkworm Network”, has its own online brand “Golden Three Towers” and its own high-end women's clothing brand “Taisha”. It has developed into a comprehensive silk industry system integrating various resource advantages such as production, R&D, trade, and Internet+。 Incident review The company's export business is growing steadily, and domestic brands have improved the company's product positioning “fashion, differentiation, and high-end”. The added value is high, and the customers are relatively high-end. The foreign trade business has maintained steady growth in recent years. In recent years, the company's annual import and export business has exceeded 200 million US dollars. The company's domestic brands include the e-commerce brand “Golden Three Towers” and the high-end women's clothing brand “Daisha”. The “Golden Three Towers” is positioned as silk underwear and loungewear. It has grown rapidly in previous years, and has grown relatively steadily in recent years; the high-end women's clothing brand “Daisha” mainly uses the marketing model of offline direct-run stores. Currently, design capabilities, channel construction, and market run-in have been continuously improved, and operational efficiency has improved. The healthy development of the company's “Golden Silkworm Net” is worth looking forward to. “Silkworm Net” is a B2B trading platform for the silk industry developed and operated by Zhejiang Golden Silkworm Net Supply Chain Management Co., Ltd., a holding subsidiary of the company. It provides service functions such as silk raw material prices, supply and demand information, and warehousing and logistics. It has become a well-known industry public information platform for silk enterprises at home and abroad. The annual transaction volume is about 8 billion yuan, and the commission is a ratio of 3 parts per 10,000, which is relatively stable; the “Jiaxing Index” formed by the “Golden Silkworm Network” is a trend indicator of international cocoon silk prices. The future focus of the Golden Silkworm Network is supply chain finance, which is interest spreads. Loan amounts have increased in the past two years. Later, the silkworm net service will grasp the price of raw materials through analysis of big data. Maintaining a “recommended” rating, the value of raw materials in the silk industry is about 60 to 70 billion yuan, and the output value of the entire industry is about 200 billion yuan. Personnel and industry experience are beneficial to the company to use the “golden silkworm net” to serve the industry and do a good job in supply chain finance. The company's import business is growing steadily, and we look forward to the company's better brand development. We expect the company's 2016 and 2017 EPS to be 0.13 yuan and 0.14 yuan respectively, corresponding to PE 62 and 58 times, respectively, to maintain the “increase in holdings” rating. Risk warning: The improvement of the company's golden silkworm net service is difficult to meet expectations, and the improvement of comprehensive brand development capabilities is uncertain