One of the four major business districts in Shanghai, the company's Xujiahui business district card advantage is obvious. The commercial system in Shanghai is mature. Among them, large department stores are mainly concentrated in several core commercial areas such as Nanjing Road, Xujiahui, Huaihai Road, and Lujiazui. In the Xujiahui business district, the company's three stores occupy half of the country's stores. In a situation where cost control ability and leverage factors are similar, the geographical location of the business district (which determines passenger flow, turnover ratio, and gross profit ratio) and the degree of competition in the business district (determines bargaining power with suppliers, which also affects gross profit margin) are the biggest factors that determine a company's ROE. As one of the top two business districts in Shanghai, the Nanjing Road business district is superior to the Xujiahui business district from the perspective of passenger traffic and sales of several single department stores, but due to the large number of department stores in the Nanjing Road business district, the bargaining power of each store over suppliers may be weaker than that of the Xujiahui business district, which has fewer core stores, from the perspective of profitability, the gross margin of the Xujiahui business district (Hong Kong Exchange and Pacific Department Stores is also about 22-24%). The gross margin of department stores is not inferior to that of the Nanjing Road business district. The company's own property has a high margin of safety. All four of the company's stores are owned by the parent company or subsidiary, with a total area of about 120,000 square meters. Apart from Huilian Commercial Building, which accounts for 77.2% of equity interest (the remaining 22.8% is held by 34 management personnel in Huilian Commercial Building), all other stores are 100% owned. We conduct a sensitivity analysis of the company's own property from the perspective of revaluation. In the three conservative, neutral, and optimistic situations, we refer to the housing prices and store transfer prices in the housing search network in the region. We gave our own properties a revaluation unit price of 50,000/square meter, 60,000/square meter, and 70,000/square meter respectively. In addition to the company's 2015Q1 monetary capital, receivables, and deducting liabilities and payables, the company's revaluation values were 6.2 billion, 7.4 billion, and 8.6 billion, respectively. The company belongs to the Shanghai Regional State-owned Assets Administration Commission, and the majority shareholders are rich in assets. The majority shareholder of the company is Xujiahui Mall (Group) Co., Ltd., which belongs to the Xuhui District State Assets Administration Commission. It holds 30.37% of the company's shares, while the remaining shareholders hold no more than 10% of the shares. The company is the only listed company platform under the Xuhui District State-owned Assets Administration Commission. The majority shareholder Xujiahui Mall (Group) holds and shares in a number of subsidiaries. The business covers mainly design import and export, product sales, property leasing, hotel catering and commercial development, etc., and some of its assets are close to the company's main stores. It is the main developer and operator of the Xujiahui business district under the district's state-owned assets. The company has maintained high dividends over the years and has long-term allocation value. Judging from the company's historical dividend data, the company's annual dividend payment rate remains at about 60%, the company's fundamentals are stable, there are no major capital expenses in the short term, and there is plenty of cash flow. We expect the company to continue to maintain a high dividend payment rate in the future. We sorted out 93 listed companies according to the retail classification of CITIC Trading and took the closing price on 2015/8/19. The company's dividend rate for the past 12 months was 2.23%, ranking second. In a situation where traditional retail prosperity continues to decline, the company's net profit and cash flow are relatively stable. The high dividend payment rate over the years shows that the company has a good corporate governance environment, maximizes shareholders' interests, and is worth allocating long-term investment by value investors when the company's margin of safety is high. Profit forecasts and valuations. We expect the company's net profit attributable to the parent company's shareholders in 2015-2017 to be 266 million, 275 million, and 281 million respectively, an increase of 3.24%, 3.28%, and 2.22% respectively. Based on the 2015/8/19 closing price, the company's PE corresponding to 2015-2017 was 25.17, 24.47, and 23.84 times. We valued the company using two methods of revaluation and comparable company PE, and gave the company a target price of 17.80-18.60 yuan, covering it for the first time and giving it an “increase in holdings” rating. Risk and uncertainty. 1) Future online giants combined with offline retail sales fell short of market expectations; 2) Shanghai's state-owned enterprise reform fell short of expectations.