Key investment points
Abstract: Recently, the national development and Reform Commission, the Internet Information Office, the Ministry of industry and information technology and the National Energy Administration jointly issued documents, agreeing to start the construction of National Computing hub nodes in 8 places such as Beijing, Tianjin and Hebei, the Yangtze River Delta and the Great Bay area of Guangdong, Hong Kong and Macao, and plan more than 10 national data center clusters. So far, the project of "computing from the east to the west" has been officially launched.
"Eastern digital computing and Western computing" conforms to the development trend of digital economy and promotes industrial digital transformation: in the 14th five year plan, it is emphasized to accelerate the development and construction of digital economy and promote the digital transformation of enterprises. With the continuous start and promotion of "Eastern digital computing and Western computing", it can make better use of the abundant resources in the west, alleviate the computing demand in the East, and better guide the intensification and development of data centers Large scale and green development will drive the development of data center industry and promote the great development of digital economy.
On the supply side, operators, as the main force of China's IDC construction, will take the lead in benefiting from the promotion of "counting from the east to the west", which can accelerate the realization of cloud network collaboration and improve the quality of computing services. At the same time, the land, network and power costs in the western region are lower, the energy consumption index is more abundant than that in the eastern region, and the construction cost may be lower. According to the statistics of CDCC's 2021 China data center market report, East China, North China and South China were the main regions in the national stock market in 2021. By the end of October 2021, the total number of cabinets in the national data center was about 4150600. According to the announcements of the three major operators, China Telecom Corporation Limited(601728) IDC has more than 420000 racks (by the end of 2020), of which 80% are deployed in four economically developed regions. About 22000, 28000 and 36000 new racks will be added from April to December 2021, 2022 and 2023 respectively. At the end of 2020 and the middle of 2021, the number of available racks of China Mobile is 260000 and 372000 respectively. At present, operators, as the main force of IDC construction, continue to increase relevant investment with the continuous expansion of cloud business. With the continuous promotion of "computing from the east to the West", operators and players in relevant supporting industries will continue to benefit.
From the demand side, the development of state-owned assets cloud dominated by operators will be accelerated: the digital transformation of state-owned enterprises will have a leading demonstration effect. In the future, state-owned assets cloud will provide guidance at the strategic and planning level and demonstration and control at the business level, so as to accelerate the deepening of China's digital economy transformation. In recent years, the cloud growth momentum of operators has been rapid. According to the interim report data of operators in 2021, the revenue of Tianyi cloud has reached 14 billion yuan, a year-on-year increase of 109.3%, and the revenue of mobile cloud has reached 9.721 billion yuan, a year-on-year increase of 118.1%, both of which exceed the total revenue of 2020; We believe that operators dominated by Tianyi cloud and mobile cloud and other state-owned clouds of central enterprises are expected to enter the front line of China in the future. The "counting from the east to the west" will be further promoted, and the business development will be further accelerated.
Suggested targets: state owned cloud & IDC: China Telecom Corporation Limited(601728) (covered), China Mobile, China United Network Communications Limited(600050) (covered), Shenzhen Sed Industry Co.Ltd(000032) ; Related equipment supporting: Nanjing Canatal Data-Centre Environmental Tech Co.Ltd(603912) (covered), Shenzhen Envicool Technology Co.Ltd(002837) (covered). Optical module: Suzhou Tfc Optical Communication Co.Ltd(300394) (covered), Zhongji Innolight Co.Ltd(300308) (covered), Eoptolink Technology Inc.Ltd(300502) , Cig Shanghai Co.Ltd(603083) etc; Servers: Zte Corporation(000063) (overwritten), Inspur Electronic Information Industry Co.Ltd(000977) , Fujian Star-Net Communication Co.Ltd(002396) , etc.
Risk warning: relevant policy support is reduced; Operator capex reduction; The development of cloud business of operators is less than expected.
