1. Undervalued and high dividends make operators become a safe haven for funds in repeated market fluctuations
The overall EBITDA / Pb level of Chinese operators is at the bottom. In recent years, under the influence of industry speed-up and decline, mobile user stock game and epidemic situation, the Pb level of the whole industry continues to decline. In this context, with the improvement of industry operation data, the stable dividend value of the three operators is highlighted.
2. Free cash flow is expected to improve marginally with the lengthening of 5g investment cycle and value operation
The ratio of capital expenditure to revenue of Chinese operators is much higher than that of overseas operators. The occupation of free cash flow makes Sinotrans Limited(601598) operators have a fault in the global industry valuation system. With the improvement of revenue conditions in 2021 and the steady trend of capital expenditure, it is expected that the ratio is expected to decline from 2021 to 2022, driving the recovery of valuation of Chinese operators.
3. The development of digital industry promotes the growth of emerging businesses, stabilizes the consumer business, and the growth of home business is driven by the Internet of things
We believe that at the key node of 5g network from infrastructure construction to application expansion, driven by the joint efforts of policy, industry and market, 5g2b market is expected to accelerate the evolution from industrial incubation stage to industrial replication stage, the demand for enterprise equipment connection has increased significantly, and the demand for digital upgrading of enterprises in multiple industries has driven the demand for 5g network construction and network transformation, Finally, accelerate the industrial explosion from point to area.
With the continuous investment in innovation fields such as IDC, IOT, smart home and cloud business, the overall cloud and intelligent transformation and upgrading of operators will help the industry transform from channel to ICT comprehensive business, sink the overall value chain of the industry to b-end applications, continue to expand the industry boundary and improve the overall valuation level of the industry.
From the perspective of C-end, 5g users accelerated penetration, the policy of raising speed and reducing fees was cancelled, the user Dou level began to accelerate, the demand for video applications is still growing, and the overall consumer business is expected to stabilize. At the same time, with the popularity of video demand, Internet of things, ultra-high definition and other business forms, the home business is also expected to maintain a high-speed growth trend.
4. Viewpoint of communication sector
1) in 2022, we will pay close attention to the main context of digital economy, take data flow as the clue, and explore new technological innovation opportunities such as intelligent sensing, silicon optical transmission and storage to cloud native driven by new applications such as metauniverse, industrial Internet and intelligent driving.
From the bottom, we continue to focus on high growth sectors such as Hong Kong stock operators (China Mobile, China Telecom Corporation Limited(601728) , China United Network Communications Limited(600050) ), it main equipment ( Unisplendour Corporation Limited(000938) , Zte Corporation(000063) ), network security, communication + new energy ( Longshine Technology Group Co.Ltd(300682) ), Internet of vehicles applications, military communications and satellite Internet ( Guangzhou Haige Communications Group Incorporated Company(002465) , Shenzhen H&T Intelligent Control Co.Ltd(002402) ), Internet of things ( Fibocom Wireless Inc(300638) ), as well as the improvement of fundamentals, Emerging tracks related to and derived from cloud ecology, including IDC ( Beijing Sinnet Technology Co.Ltd(300383) , Guangdong Aofei Data Technology Co.Ltd(300738) , Black Peony (Group) Co.Ltd(600510) ; related benefit targets Capitalonline Date Service Co.Ltd(300846) ), edge computing and cloud primitives (related benefit targets Qingcloud Technologies Corp(688316) ), metauniverse, etc. ( Hangzhou Anysoft Information Technology Co.Ltd(300571) ).
2) recommend undervalued stocks this week: Unisplendour Corporation Limited(000938) , Willfar Information Technology Co.Ltd(688100) , Black Peony (Group) Co.Ltd(600510) (acquisition of Aite energy layout thermal energy management business), Tcl Technology Group Corporation(000100) , Tianjin 712 Communication & Broadcasting Co.Ltd(603712) , Beijing Sinnet Technology Co.Ltd(300383) , Goldcard Smart Group Co.Ltd(300349) , Aisino Corporation(600271) , Hangzhou Anysoft Information Technology Co.Ltd(300571) , Zte Corporation(000063) and other companies
5. Risk warning
5g network construction is less than expected; The development of private network applications in related industries is less than expected.
