The dividend of traditional communication is gradually receding, and the 5g investment clock is turning to tracks such as “zhizaozhilian + Haifeng new energy”. In 2021, the epidemic situation eased and the demand gradually recovered. However, the performance of some enterprises was put under pressure by factors such as shortage and price rise of upstream raw materials, sharp increase of transportation costs, appreciation of RMB, power and production restriction and so on. Looking forward to 2022, we judge that the epidemic situation and upstream cost pressure are expected to ease, demand will continue to recover, 5g user penetration will continue to increase, new applications represented by “meta universe” will emerge one after another, the dual carbon policy will continue to promote, and the country will vigorously promote the digital economy, We believe that the investment in the communication industry will focus on the three main lines of “intelligent manufacturing, intelligent networking and new energy of wind power”, and focus on investment opportunities in key sectors such as cloud computing and operators.
Track 1 in 2022: focus on the target of strong alpha and high growth certainty with Zhizao Zhilian as the core. In the double carbon era, the country vigorously promotes the development of [intelligent manufacturing & Industrial Internet]. At present, intelligent manufacturing has low penetration and broad development space. It focuses on the ecological layout of process intelligent manufacturing leaders + discrete intelligent manufacturing providers binding core key customers + basic industrial software enterprises such as CAD / EDA; With the strong support of a number of national policies, China’s [intelligent networking & new energy vehicles] is expected to enter a period of rapid development, opening a broad growth space for automotive electronic sub circuits such as vehicle lens, lidar, controller, vehicle module and connector; 5g era welcomes the feast of [aiot & Power Internet of things]. We believe that investment opportunities at this stage mainly focus on three application scenarios: module, power Internet of things and intelligent controller.
Track 2 in 2022: the sea breeze has a large space for long-term growth, and attaches importance to certain tracks such as submarine cable. In recent years, China has vigorously promoted the adjustment, transformation and upgrading of the energy structure. Under the dual carbon policy, new energy sources such as wind power and photovoltaic have been further developed, the installed capacity has achieved rapid growth, and the cost has also been rapidly reduced. It is a major industrial direction we are optimistic about. [submarine cable] as the most deterministic link of Haifeng industrial chain, it has the characteristics of high competition barriers, stable competition pattern and small space for price exploration. At the same time, the development of far-reaching sea is expected to drive the submarine cable industry to usher in a new opportunity of “simultaneous rise in volume and price” and enhance the demand for flexible DC technology submarine cable, and the submarine cable leader is expected to benefit from the core. At the same time, it is suggested to actively pay attention to the combination and development of new energy and communication industry, such as the layout of energy storage and temperature control, inverter, distribution cabinet and other communication enterprises.
Track 3 in 2022: the state vigorously promotes the digital economy, Chinese foreign cloud giants actively layout new application tracks such as metauniverse, and the long-term high growth trend of cloud computing remains unchanged. The state attaches great importance to the strategic layout of the digital economy. As the core base of the digital economy, communication, especially cloud computing, is expected to usher in a development window period. Although in the short term, due to the lack of cores in the upstream and the failure of new applications in the downstream, the cloud computing industry chain has undergone a wave of adjustment. In the long term, with the rise of new applications such as meta universe, Chinese and foreign cloud giants have invested heavily in capital expenditure, which is expected to drive the development of cloud computing industry chain (IDC, network equipment & IT equipment, optical devices, cloud video and cloud Office). The long-term growth of cloud computing industry is highly uncertain.
Investment suggestion: focus on core sectors such as cloud computing and operators with the main line of “smart manufacturing and smart alliance + Haifeng new energy”. Track 1: intelligent manufacturing + Intelligent Networking – 1) Intelligent Manufacturing: key recommendations: Shanghai Baosight Software Co.Ltd(600845) , Zhejiang Supcon Technology Co.Ltd(688777) , Zte Corporation(000063) , Unisplendour Corporation Limited(000938) , Guangzhou Sie Consulting Co.Ltd(300687) , Nancal Technology Co.Ltd(603859) ; It is suggested to pay attention to: Foxconn Industrial Internet Co.Ltd(601138) , Anhui Ronds Science & Technology Incorporated Company(688768) , Dongguan Yiheda Automation Co.Ltd(301029) , Shenzhen Invt Electric Co.Ltd(002334) , Shanghai Weihong Electronic Technology Co.Ltd(300508) ; 2) Intelligent Internet connected vehicle: key recommendations: Fibocom Wireless Inc(300638) , Quectel Wireless Solutions Co.Ltd(603236) , Meig Smart Technology Co.Ltd(002881) , Queclink Wireless Solutions Co.Ltd(300590) , Ningbo Yong Xin Optics Co.Ltd(603297) , Zhejiang Crystal-Optech Co.Ltd(002273) , Keboda Technology Co.Ltd(603786) ; It is suggested to pay attention to: Shenzhen H&T Intelligent Control Co.Ltd(002402) , Shenzhen Topband Co.Ltd(002139) , Shanghai Huace Navigation Technology Ltd(300627) , sunny optics, Lianchuang Electronic Technology Co.Ltd(002036) , Dongguan Yutong Optical Technology Co.Ltd(300790) , Arcsoft Corporation Limited(688088) , Foryou Corporation(002906) , torch technology, Advanced Fiber Resources (Zhuhai) Ltd(300620) , Optowide Technologies Co.Ltd(688195) , Suzhou Tfc Optical Communication Co.Ltd(300394) , Hangzhou Hopechart Iot Technology Co.Ltd(688288) , Electric Connector Technology Co.Ltd(300679) , Suzhou Recodeal Interconnect System Co.Ltd(688800) , Shenzhen Deren Electronic Co.Ltd(002055) , Shenglan Technology Co.Ltd(300843) , Wenzhou Yihua Connector Co.Ltd(002897) , Zhejiang Yonggui Electric Equipment Co.Ltd(300351) , Dongguan Dingtong Precision Metal Co.Ltd(688668) , Cwb Automotive Electronics Co.Ltd(605005) , Shanghai Laimu Electronics Co.Ltd(603633) etc; 3) Internet of things: key recommendations: Fibocom Wireless Inc(300638) , Quectel Wireless Solutions Co.Ltd(603236) , Meig Smart Technology Co.Ltd(002881) , Queclink Wireless Solutions Co.Ltd(300590) , Beijing Inhand Networks Technology Co.Ltd(688080) ; It is suggested to pay attention to: Willfar Information Technology Co.Ltd(688100) , Hangzhou Hopechart Iot Technology Co.Ltd(688288) , Hanwei Electronics Group Corporation(300007) , etc. Track 2: Haifeng new energy – 1) submarine cable: key recommendation: Jiangsu Zhongtian Technology Co.Ltd(600522) ; It is suggested to pay attention to: Hengtong Optic-Electric Co.Ltd(600487) , Ningbo Orient Wires & Cables Co.Ltd(603606) ; 2) Temperature control and energy storage: attention is recommended: Shenzhen Envicool Technology Co.Ltd(002837) , Guangdong Shenling Environmental Systems Co.Ltd(301018) , Guangzhou Goaland Energy Conservation Tech Co.Ltd(300499) , Kehua Data Co.Ltd(002335) . Track 3: cloud computing + operators – 1) cloud computing: key recommendations: Shanghai Baosight Software Co.Ltd(600845) , Beijing Sinnet Technology Co.Ltd(300383) , Zte Corporation(000063) , Unisplendour Corporation Limited(000938) , Beijing Kingsoft Office Software Inc(688111) , BiliBili, etc; Suggestions: Qinhuai data, Wanguo data, Kehua Data Co.Ltd(002335) , Guangdong Aofei Data Technology Co.Ltd(300738) , Shenzhen Envicool Technology Co.Ltd(002837) , Fujian Star-Net Communication Co.Ltd(002396) , Eoptolink Technology Inc.Ltd(300502) , Zhongji Innolight Co.Ltd(300308) , Accelink Technologies Co.Ltd(002281) , Suzhou Tfc Optical Communication Co.Ltd(300394) , Guangzhou Shiyuan Electronic Technology Company Limited(002841) , Yealink Network Technology Co.Ltd(300628) , Bizconf Telecom Co.Ltd(300578) , Montnets Cloud Technology Group Co.Ltd(002123) etc; 2) Operators: suggestions: China Mobile, China Telecom Corporation Limited(601728) , China United Network Communications Limited(600050) .
Risk factors: the development of 5g and cloud computing is not as expected, and the covid-19 epidemic spread.
