Core view: The company is a leader in high-end underwear in China. It is technology-driven and provides high-quality underwear products. In the context of the rise of rimless underwear in the past few years, the company actively embraces industry changes through measures such as launching a rimless underwear category, updating the brand slogan (promoting women's self-acceptance/appreciation/growth), and increasing investment in e-commerce and new media marketing. Revenue has increased steadily over the past 3 years. In the future, the company will continue to revitalize its main brand and increase the development of subcategories such as underwear/sports underwear.

Profit forecast: The company's revenue for 2021-2023 is expected to be 36.3, 40.4, and 4.68 billion yuan respectively, up 8.0%, 11.2% and 15.8% respectively; the net profit of the mother is 493, 532, and 585 million yuan respectively, up 10.9%, 7.9% and 10.0% respectively; corresponding PE is 22, 20 and 18 times, respectively, maintaining the “buy” rating. (2021/8/31 closing price)

Risk warning: competition in the underwear industry intensifies, new brand expansion falls short of expectations