I. moderately increase capital expenditure: China United Network Communications Limited(600050) plans to complete the construction of 5g network scale in about three years Wang Junzhi, deputy secretary of China United Network Communications Limited(600050) said that in 2022, China United Network Communications Limited(600050) will moderately increase capital expenditure, keep the growth of capital expenditure matching the growth of income, and keep a stable proportion of income. It is planned to complete the scale construction of 5g network in about three years, and the overall capital expenditure will remain stable in the next few years. On the one hand, China United Network Communications Limited(600050) with the action plan of building a new digital information infrastructure as the traction, accelerate the construction of “four high-quality networks”, moderately advance the core competitiveness of innovative products, coordinate the network industry, make accurate investment, and consolidate the cornerstone of the company’s high-quality development. On the other hand, the increased investment in transmission network and infrastructure mainly meets the capacity layout of data center, and moderately increases the investment in East digital West computing network; The increased investment in broadband and data is mainly used to speed up the deployment of broadband gigabit network and the construction of government enterprise boutique network.
The China United Network Communications Limited(600050) capital expenditure in 2021 is 68 billion yuan, of which mobile network, fixed network broadband and data, infrastructure transmission network and others account for 49%, 19% and 32% respectively; The capital expenditure of broadband and other networks in 2020 is RMB 6.6 billion, of which the capital expenditure of broadband and other networks is RMB 6.6 billion, accounting for 5.0% and 5.0% respectively. We believe that the communication industry has fully benefited from the accelerated investment of operators in 5g network construction, core network, transmission network and East digital West computing network. It is recommended to pay attention to the manufacturers of core communication equipment and optical modules: Zte Corporation(000063) , Unisplendour Corporation Limited(000938) , Zhongji Innolight Co.Ltd(300308) .
II. Light of China on OFC: 800g optical module has become the main new product. Chinese enterprises have become an important pole of the global optical communication industry, especially in the field of optical modules, which has accounted for 50% of the world. There is not only scale, but also technology. At this OFC, we can see that Chinese suppliers, represented by 800g optical modules, shine brightly. Chinese suppliers of 800g optical modules released or demonstrated on this OFC, including Hengtong lockley, xuchuang technology, Huagong Zhengyuan, sols optoelectronics, Eoptolink Technology Inc.Ltd(300502) , Accelink Technologies Co.Ltd(002281) , etc.
800g optical module is the standard configuration of the latest generation of optical transmission system and has great market potential. Lightcounting, a research organization, predicts that 800g optical modules will gradually increase in volume from 2022, and it is expected that the sales of 400g optical modules will exceed by 2024, with a market scale of US $7 billion. If Chinese suppliers take half of the share, they will have a market cake of US $3.5 billion to share. 800g ultra-high speed optical network is gradually approaching. On the 800g system side, Huawei and Zte Corporation(000063) have been in the leading position in the industry. We believe that the growing data consumption demand of users drives the growth of data center demand, and the intergenerational upgrading of optical modules to 800g brings increment to the industry. We suggest paying attention to the leading manufacturers of optical modules: Zhongji Innolight Co.Ltd(300308) , Eoptolink Technology Inc.Ltd(300502) , Accelink Technologies Co.Ltd(002281) .
III. IDC: in 2021, the global enterprise WLAN market grew by 20.4% and the Chinese market grew by 47.2%. In the fourth quarter of 2021, the global enterprise wireless local area network (WLAN) market continued to grow strongly, with revenue increasing by 21.8% year-on-year to US $2.3 billion. For the whole year of 2021, the revenue of enterprise WLAN market increased by 20.4% over 2020, reaching US $7.6 billion. The growth of the enterprise WLAN market continues to be driven by the latest Wi Fi standard Wi Fi 6 or 802.11ax. Wi Fi 6 access points account for 75.1% of the non independent access point (AP) business revenue and 61.3% of the business shipments. Wi Fi 5 products, namely 802.11 AC, account for the majority of AP sales. In the fourth quarter of 2021, the global Ethernet switch market revenue reached US $8.5 billion, with a year-on-year increase of 11.8%; The annual revenue in 2021 was US $30.7 billion, a year-on-year increase of 9.7%.
From the operation of major manufacturers, Cisco’s corporate WLAN market revenue increased by 22.1% in the fourth quarter and 14.2% in the whole year. In 2021, Cisco’s market share was 40.5%, slightly lower than 42.7% in 2020. Huawei’s revenue in the fourth quarter increased by 48.0% year-on-year and 44.4% in the whole year. The annual market share increased to 7.4% from 6.2% in 2020. H3C’s revenue increased by 41.8% in the fourth quarter and 33.7% in the whole year, raising the company’s market share to 4.8% from 4.3% in 2020.
Cisco’s Ethernet switch revenue increased by 7.5% year-on-year in the fourth quarter of 2021, increased by 3.4% in 2021, and Cisco’s market share was 45.3%. Huawei’s Ethernet switch revenue increased by 14.4% in the fourth quarter and 8.3% in the whole year. The market share in 2021 was 10.2%. H3C’s Ethernet switch revenue increased by 21.1% in the fourth quarter, 17.9% in the whole year, and the market share was 6.1% in 2021. In the SP and enterprise router market, H3C’s revenue increased by 22.8% in the fourth quarter, 33.7% in the whole year, and its market share reached 2.2% in 2021. The data shows a strong demand for enterprise WLAN equipment. Among them, Xinhua III’s share in enterprise network has increased, and Ethernet switches, SPS and routers have increased rapidly. It is suggested to pay attention to the leading manufacturer of enterprise network equipment: Unisplendour Corporation Limited(000938) .
Industry highlights
\u3000\u30001. Vietnam aims to significantly increase mobile broadband penetration: from 57% to 85% a year
At the 2022 World Mobile Broadband and ICT summit held in Hanoi, van der Loong, Vice Minister of information and communication of Vietnam, said that the government’s goal is to increase the penetration rate of mobile broadband users from 57% in 2021 to 85% by the end of 2022. Considering that the mobile broadband penetration rate has increased by 4 percentage points year-on-year in 2021, the goal of increasing it by 28 percentage points will be an impressive achievement. By the end of 2021, the number of broadband users in the country had reached 70.9 million. By the end of 2021, 78% of mobile users had smartphones. The country of 97 million people has 156 million mobile connections, including 42.9 million LTE connections.
\u3000\u30002. New regulations of the United States: no manual steering vehicle equipped with steering wheel and other manual control devices.
US regulators issued the final rules on Thursday, cancelling the requirement for automatic driving car manufacturers to install manual control devices for fully automatic driving vehicles to meet crash standards.
The new regulations revise the provision that cars “will always need to have a driver’s seat, a steering wheel and an attached steering column, or only one front outboard passenger seat”.
Existing regulations currently do not prohibit the deployment of autonomous vehicles as long as they have manual driving control functions, and manufacturers may still need to apply to NHTSA for an exemption to sell their vehicles equipped with ads as NHTSA continues to consider changing other safety standards.
Recommended this week: 5g construction leader [ Zte Corporation(000063) ]; [ Unigroup Guoxin Microelectronics Co.Ltd(002049) ] with the acceleration of domestic substitution and the warming of super SIM card sales; Benefiting from the rapid growth of intelligent controller industry [ Shenzhen H&T Intelligent Control Co.Ltd(002402) ]; [ Meig Smart Technology Co.Ltd(002881) ] of rapid and large-scale Internet of things module; Beidou industry solution leader [ Shanghai Huace Navigation Technology Ltd(300627) ]; [ Zhongji Innolight Co.Ltd(300308) ] benefiting from the increasing demand for optical modules.
Long term recommendation: 5g main equipment and infrastructure: Zte Corporation(000063) ; Optical communication: Suzhou Tfc Optical Communication Co.Ltd(300394) , Zhongji Innolight Co.Ltd(300308) , Eoptolink Technology Inc.Ltd(300502) , Accelink Technologies Co.Ltd(002281) , Broadex Technologies Co.Ltd(300548) Advanced Fiber Resources (Zhuhai) Ltd(300620) ； Optowide Technologies Co.Ltd(688195) , torch technology; Radio frequency: Guangdong Shenglu Telecommunication Tech.Co.Ltd(002446) ; Benefit flow explosion: Fujian Star-Net Communication Co.Ltd(002396) , New Guomai Digital Culture Co.Ltd(600640) , Wangsu Science & Technology Co.Ltd(300017) ; Internet of things segment: Quectel Wireless Solutions Co.Ltd(603236) , Fibocom Wireless Inc(300638) , Meig Smart Technology Co.Ltd(002881) , Hanwei Electronics Group Corporation(300007) , Queclink Wireless Solutions Co.Ltd(300590) . IDC direction: Beijing Sinnet Technology Co.Ltd(300383) , Shanghai Athub Co.Ltd(603881) , Shanghai Baosight Software Co.Ltd(600845) , Guangdong Aofei Data Technology Co.Ltd(300738) ; 5g message: Montnets Cloud Technology Group Co.Ltd(002123) , Zjbc Information Technology Co.Ltd(000889) , Wutong Holding Group Co.Ltd(300292) ; Industrial Internet: Business-Intelligence Of Oriental Nations Corporation Ltd(300166) ; Intelligent controller: Shenzhen H&T Intelligent Control Co.Ltd(002402) , Shenzhen Topband Co.Ltd(002139) . Energy storage is related to new energy: Jiangsu Zhongtian Technology Co.Ltd(600522) , Hengtong Optic-Electric Co.Ltd(600487) , Kehua Data Co.Ltd(002335) , Longshine Technology Group Co.Ltd(300682) .
Risk tips
(1) systemic risk caused by the unexpected decline of the market;
(2) focus on the uncertainty risk of promoting relevant matters of the company.
