As shown by 2008 annual report, the company realized business turnover of Rmb1649mn (+26% yoy), which was under the market expectation, total profit of Rmb184mn (+12% yoy), net profit of Rmb174mn (+3.2% yoy), and EPS of Rmb0.27, which was sharply below Rmb0.40 and Rmb0.38 that expected by the market and us.
Earning forecast and rating: Given that 2008 performance is sharply below expectation, we lower the company’s EPS in 2009-2010E to Rmb0.6 and Rmb0.72 by Rmb0.07 and Rmb0.1 respectively. Based on closing price of Rmb14.77 on March 25, 2009, representing dynamic P/E ratio is at 25x and 21x. We are still optimistic with its future development, and “Overweight” rating is hereby maintained.