Brand chain enterprises become the focus of lighting electrical industry

December electric light source and lighting sales reached 876 million and 94 million 181 thousand and 300 Taiwan (sets), the electric light sales grew 6.33%, compared with the previous month; lighting sales grew 27.90%; an increase of 16.82%. Accelerate the speed of lamps. 2005 annual sales of electric light source 9 billion 690 million, an increase of 15.95%.

- 2005 total industry sales revenue 91 billion 184 million yuan, an increase of 23.55%; export delivery value of 47 billion 489 million yuan, an increase of 20.77%; total profit of 3 billion 736 million yuan, an increase of 9.29%.

Enters 2006, lighting the main raw material prices: copper tin price highs; fast recovery; continue to shrink the import and export price of tungsten in December, have spread to the expansion of import and export of molybdenum wire.

- brand chain lighting appliance business is the most concern in 2005 lighting industry. The rise of Huizhou NVC company is gradually changing the traditional lighting industry in China's competition pattern.

- FSL 2005 total sales revenue of 1 billion 111 million yuan, down 8.19% compared with 2004, the total profit of 270 million yuan, down 7.01% compared with 2004, 2005 earnings per share of about 0.625 yuan.

Forecast earnings per share of 0.62 yuan and 0.75 yuan - 05/06 company FSL. Considering that FSL has entered a new round of growth cycle, Zhejiang sunshine pre or large, we maintain FSL (000541) and Zhejiang sunshine (600261) investment rating to "recommend" and "cautious recommendation" unchanged.

Including the risk factors: macro-control, raw material prices, RMB appreciation, trade friction and anti dumping. Pay close attention to macro control and the growth of real estate industry. Performance prediction and investment recommendations FSL earnings forecast assumptions: 1, is expected to /06 years in China, the lighting industry grew by 18%, 15%. Export growth of 20%. 2, real estate investment remains about 20% growth. 3, the main raw material prices will have a certain degree of decline, the overall cost of materials decreased by 3%~5%. 4, the ratio of the rate of three in accordance with the provisions of the quarterly index of 3, the income tax rate in accordance with the actual proportion of the first 05 quarters of three. 5, 05 years /06 yuan appreciation rate of 3%~5%. Forecast 05/06 earnings per share were 0.62 yuan and $0.75. February 8th FSL A shares closing price of 11.26 yuan, the dynamic price earnings ratio of 18.16 times and 15.01 times, taking into account the company has more than 70% of the annual dividend rate and entered a new growth cycle, and the share price on May, the company's current reasonable price in more than 12.50 yuan. Maintain the recommended rating unchanged. In 2005, Zhejiang sunshine entered a period of rapid growth, mainly exports of energy-saving lamps and other products have a substantial growth. The domestic market, with the introduction of energy-saving measures, energy-saving lamps have a larger space for development. However, many domestic energy-saving lamp enterprises, competition will be more intense, the domestic market has yet to be standardized. Zhejiang sunshine split share structure reform of non tradable shares to the circulation of shareholders to pay the price of 3 shares for every 10 shares, and received cash of $1.88. February 8th stock price 10.26 yuan, reference to the forecast earnings for the past 05 years, the company's dynamic price earnings ratio of 13.15 times. The company's share price has a larger increase, taking into account the stability of the company's operations, corporate governance structure, dividend rate and other factors, to give the company cautious recommend investment rating unchanged.