Key investment points:
This month, CITIC computer index fell 9.51%, underperforming the market by 1.6 percentage points, ranking 18th among 30 CITIC primary industries. 65 stocks rose, 213 fell, mainly down. The current industry valuation is 47.83 times, significantly lower than the medium and long-term historical average.
This month, a number of important industry plans such as the 14th five year plan for promoting national government informatization and the 14th five year plan for digital economy development were issued. At the same time, Xi Jinping general secretary also published a signed article on “constantly strengthening, optimizing and expanding China’s digital economy” in Qiushi magazine, which further elaborated on the development ideas of digital economy.
This month has entered the centralized release period of the annual performance forecast for 2021. From the tracked key sub industries: (1) network security: there has been a high growth in revenue but a decline in net profit. At the same time, the performance in the fourth quarter has been affected by the government budget and the epidemic, which is generally lower than expected; (2) Medical Informatization: from the perspective of the head company, B-Soft Co.Ltd(300451) deducted non net profit exceeded the industry leader Winning Health Technology Group Co.Ltd(300253) for the first time, and the performance was lower than expected, which also became an important reason for the decline of Winning Health Technology Group Co.Ltd(300253) this month; (3) Industrial software: the performance is generally high growth, and the industry as a whole presents a state of high vision.
According to the industry data: (1) in 2021, China National Software And Service Company Limited(600536) business revenue was 9.50 trillion yuan, with a year-on-year increase of 17.7%. The annual revenue increased by 15.5% compared with the two-year compound growth rate in 2019, exceeding the growth rate in 2016, 2017, 2018 and 2020. (2) In 2021, the number of employees in the software industry increased by 7.4% and the salary increased by 15.0%. Due to the impact of the epidemic last year, the speed of enterprise recruitment slowed down, and the growth rate of the number of employees in 2021 has exceeded the level of previous years. In 2022, as the personnel growth returns to the normal level, the pressure on the overall salary growth of the industry is expected to weaken. (3) From the perspective of income growth of sub industries in December, the annual growth rate of industrial products was 24.8%, which was 4.7 percentage points higher than that from January to November, which was the industry with the most obvious improvement in December. The information security industry increased by 13.0% year-on-year, down 6.0 percentage points from January to November. (4) In 2020, the scale of China’s digital economy was US $5.4 trillion, ranking the second in the world, but the overall size is not strong.
Considering that the computer industry fell too fast years ago, we think there is a large rebound demand in the industry after the festival. According to the disclosed performance forecast, it shows that the performance of the industry in the fourth quarter is lower than expected, but we can see that the head company still shows a rapid revenue growth trend throughout the year. At the same time, we believe that with the strong support of the digital economy development policy, the industrial construction of digital economy is still the rigid demand for China’s industrial upgrading and Government Governance Capacity Upgrading in the next step. Therefore, it is bound to get priority protection and benefit the long-term development of the computer industry.
Recommended targets of this month: B-Soft Co.Ltd(300451) (300451), Venustech Group Inc(002439) (002439).
Risk warning: uncertainty of international situation; The upper reaches of enterprises cut spending under inflation; Local debt risk release; The epidemic development exceeded expectations.
