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　　 Changjiang Securities

Perfect creator of tourism and cultural performance.

The company's theme parks are divided into two categories: culture and recreation, giving full consideration to the audience of tourists of different ages; Tourism performance combines the scenic resources of Song City with the cultural connotation of the Song Dynasty, and innovatively launches the cultural performance program "Eternal Love of Song City". The business model of "theme park+tourism performance" has become increasingly mature and has become the core competitiveness of the company in the tourism performance market.

Hangzhou's main business is indestructible, and we look forward to making breakthroughs and creating brilliance again.

The success of the "Songcheng Mode" has enabled the company to continuously increase the development and reconstruction and expansion of scenic spots. The complete layout of the second phase of Songcheng, the reconstruction and expansion of Hangzhou Paradise and the upgrading of rotten apple Paradise show that the company expects Hangzhou's main business to achieve better results on the basis of consolidating its main business. We believe that the main business of Hangzhou is expected to reach a new high under the combined effect of favorable factors such as traffic improvement, ticket price increase and the injection of "Wu Yue Eternal Love".

"Song City Model" runs through the country, and projects in different places are further promoted.

Through the strategic layout of several domestic first tier tourism cities, the non local projects will become the company's new profit growth pole. According to the project positioning, planning and policy support in the region, we are optimistic about the long-term profit prospects of projects in different regions. However, considering that the early operation may face many uncertainties, we are cautiously optimistic about the short-term profit prospects of some projects.

Policy support is the key to future development.

The two major industries of culture and tourism are national strategic pillar industries. The central and local governments have recently issued a number of favorable policies to enable the development of the company's main business and projects in other places to enjoy the industry's favorable policy support.

The performance growth is determined and the valuation level is reasonable.

In view of the high growth potential of the company in the next three years, it is estimated that the company's EPS in 2012-2014 will be 0.45 yuan, 057 yuan and 072 yuan, respectively, and the corresponding PE will be 26 times, 20 times and 16 times of the estimated value, which is in a reasonable range. We give the rating of "recommended".

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