The advantage of warp knitting leader is obvious, and the expansion of medical devices is accelerated. As one of the leading enterprises in the warp knitting industry, its automobile interior fabric is the main growth point of the company's warp knitting business. as Shanghai Volkswagen, Shanghai General Motors, Shanghai Automobile, FAW-Volkswagen, Beijing Hyundai, BYD, Geely, Chery Automobile and other suppliers, most of the company has ranked in the forefront, and its leading advantages are relatively obvious. On the other hand, the company's medical instruments are also experiencing an accelerated development cycle of endogenous structural optimization (increasing the proportion of color ultrasound, starting functional therapeutic color ultrasound) and epitaxial expansion, we expect, device business explosive growth or high probability events in the future.

Medical devices: optimize the product structure, push through the old and bring forth the new to accelerate the pace of expansion. We believe that the optimization of the company's future product structure and profitability will be achieved mainly through two aspects: on the one hand, the increase in the proportion of high-margin color ultrasound (the reduction of the cost of color ultrasound, the growth of market replacement demand); on the other hand, functional therapeutic ultrasound instruments (such as thrombolytic therapy, thrombolytic therapy and cervical drainage, etc.). At the same time, we believe that at a time when the mobility and high-end of medical devices may become the development trend of the industry, the company may further expand its product capacity, push through the old and bring forth the new, and further accelerate the pace of plate expansion by relying on Wilder's ultrasonic advantage platform.

Warp knitting: consolidate the leading advantage of the Red Sea and open up new fields of the Blue Sea. As far as automobile interior fabrics are concerned, the more powerful domestic competitors are mainly HTC warp knitting, Jiangsu wide-ranging, Ryan Lear, Shen Dachuan Island, Qingdao Fuji. By the end of 13 years, we estimate that the market capacity of the national automobile roof interior industry is about 750 million yuan, the company accounts for about 26% of the subdivided industry, and the industry CR5 is about 42%, the company's leading position is obvious. In the future, if the company can enter the supply chain of middle and high-end cars such as BMW and Audi, we think it will open the blue sea road of the company's interior fabrics.

We estimate that the EPS of the company in 13-15 is 0.46, 0.67 and 1.01 yuan. Through the segment valuation, we think that the reasonable target price of the company is 26.1 yuan. According to the current price, there is still room for 20%, and we will be given a "overweight" rating. We estimate that the 14-year net profit of the company's warp knitting business is about 77 million yuan, and the 14-year net profit of medical devices is about 83 million yuan. The warp knitting business is conservatively estimated to be 17 times PE, while the device business is valued 50 times, then the company's reasonable share price is about 26.1 yuan. According to the current price, there is still 20.2% room for improvement.