This week’s view:
I. The Rise of financial + science and technology sanctions under the conflict between Russia and Ukraine may stimulate the acceleration of domestic substitution in China. Recently, European and American countries have continued to impose sanctions on Russia. The main measures include: (1) disable swift settlement system; (2) Impose financial sanctions and export controls on Russia, and seal up the overseas assets of the Russian government and elites; (3) Multinational companies led by Europe and the United States imposed sanctions on Russia, including suspending the provision of services and stopping trade with Russia.
We believe that sanctions will have a great impact on the Russian economy and financial system in the short term. In the medium and long term, Russia has corresponding alternatives to Western sanctions. If the subsequent sanctions are not upgraded to energy such as oil and natural gas, it is expected to have a bone breaking impact on the Russian economy. The sanctions against Russia will accelerate the replacement process made in China.
II. The two sessions mentioned the digital economy, and digital RMB and financial innovation are expected to benefit first. In the 2022 government work report, Premier Li Keqiang proposed to promote the development of digital economy and strengthen the overall layout of Digital China construction. Build digital information infrastructure, promote the large-scale application of 5g, promote the digital transformation of industries, and develop smart cities and digital villages.
2022 will usher in the dual drive of financial industry + sinking market substitution. According to the “2 + 8 + n” development process of information and innovation, the party and government information and innovation started the earliest, and the follow-up focus is to sink and deepen its application to the district and county-level market. Combined with the impact of the situation in Russia and Ukraine, China will continue to improve the domestic substitution, independent and controllable process in the core fields of Party and government, finance and so on.
At present, the research and development test of digital RMB has basically completed the top-level design, function research and development, system debugging and other work. Since its launch on January 4, as of January 19, the cumulative number of downloads in each application market has been close to 25 million, the number of digital RMB pilot scenarios has exceeded 8.0851 million, 261 million personal wallets have been opened, and the transaction amount is 87.565 billion yuan (as of the end of 2021).
III. investment suggestions
1) from the perspective of Xinchuang: domestic WPS leading manufacturer Beijing Kingsoft Office Software Inc(688111) (jointly covered with small and medium-sized disk groups), domestic middleware leading Beijing Tongtech Co.Ltd(300379) , domestic PDF leading Fujian Foxit Software Development Joint Stock Co.Ltd(688095) , domestic server leading Dawning Information Industry Co.Ltd(603019) .
2) from the perspective of ecological operation: Bank IT manufacturers usher in system transformation and scenario operation opportunities. Commercial banks have become an important subject of DCEP issuance (exchange), and bank IT manufacturers have ushered in system transformation and scenario operation opportunities. Combined with the current scenario expansion process of the central bank, we believe that we should focus on the head bank IT manufacturers at this stage, with both the certainty of bank side it transformation and the imagination space of scenario operation. Focus on recommending Yusys Technologies Co.Ltd(300674) , Shenzhen Sunline Tech Co.Ltd(300348) , Digital China Information Service Company Ltd(000555) , and other beneficiary manufacturers include Tansun Technology Co.Ltd(300872) , Northking Information Technology Co.Ltd(002987) , Global Infotech Co.Ltd(300465) , etc.
3) from the perspective of hardware Wallet: financial equipment manufacturers will also usher in large-scale transformation opportunities. The downstream hard wallet is an important part of the circulation link. As the main payment terminals, smart POS and ATM will take the lead in releasing the transformation demand. This foreign card, visual card, bracelet and other hard wallet carriers also have transformation expectations. The beneficiary objects include Chutian Dragon Co.Ltd(003040) , Urovo Technology Co.Ltd(300531) , Newland Digital Technology Co.Ltd(000997) , Xgd Inc(300130) , Lakala Payment Co.Ltd(300773) , Grg Banking Equipment Co.Ltd(002152) , etc.
Investment advice
Reiterate that we are firmly optimistic about the leading companies with card advantages in cloud computing SaaS, energy it, financial technology, intelligent driving, artificial intelligence and other prosperous tracks, and actively recommend the following seven investment lines: 1. Cloud computing SaaS: focus on recommending enterprise SaaS leaders Yonyou Network Technology Co.Ltd(600588) , office software leaders Beijing Kingsoft Office Software Inc(688111) (joint coverage with small and medium-sized markets) Super fusion leader Sangfor Technologies Inc(300454) . 2. New energy it: focus on recommending energy SaaS leader Longshine Technology Group Co.Ltd(300682) (joint coverage of communication group), distribution network dispatching pioneer Dongfang Electronics Co.Ltd(000682) , domestic energy BIM software leader Beijing Forever Technology Co.Ltd(300365) . 3. Fintech: focus on recommending securities it Hundsun Technologies Inc(600570) . In addition, Yusys Technologies Co.Ltd(300674) , Shenzhen Sunline Tech Co.Ltd(300348) , Hithink Royalflush Information Network Co.Ltd(300033) , all welcome the upswing of the economy. 4. Intelligent driving: the vehicle OS leader Thunder Software Technology Co.Ltd(300496) , the intelligent cockpit leader Huizhou Desay Sv Automotive Co.Ltd(002920) (joint coverage of vehicle groups) and the high-precision map leader Navinfo Co.Ltd(002405) are recommended as the key benefit targets. 5. Artificial intelligence: recommend intelligent voice faucet Iflytek Co.Ltd(002230) . 6. Network security: focus on recommending emerging security double leaders Qi An Xin Technology Group Inc(688561) + Sangfor Technologies Inc(300454) , Dbappsecurity Co.Ltd(688023) as a subdivided emerging security leader, which will also benefit deeply. Other beneficiaries include: Venustech Group Inc(002439) , Xiamen Meiya Pico Information Co.Ltd(300188) , etc. 7. Xinchuang: domestic WPS leading manufacturer Beijing Kingsoft Office Software Inc(688111) (jointly covered with small and medium-sized disk groups), domestic middleware leading Beijing Tongtech Co.Ltd(300379) , domestic PDF leading Fujian Foxit Software Development Joint Stock Co.Ltd(688095) , domestic server leading Dawning Information Industry Co.Ltd(603019) .
Risk tips
Market systemic risks, the landing of scientific and technological innovation policies is less than expected, and the game between China and the United States is an emergency.
