Key investment points:
Market review and Valuation: last week (December 27-december 31), Shenwan computer industry rose 1.67%, outperforming Shanghai and Shenzhen 300 index by 1.28 percentage points, ranking 16th among Shenwan 31 industries; Shenwan computer sector rose by 1.63% in December 2021, 0.61 percentage points lower than Shanghai and Shenzhen 300 index, ranking 18th in Shenwan industry; Shenwan computer sector rose by 1.37% in 2021, outperforming the Shanghai and Shenzhen 300 index by 6.57 percentage points, ranking 20th in Shenwan industry. In terms of valuation, as of December 31, 2021, the pettm of SW computer sector was 53.29 times, at the 37.11% quantile in recent 5 years and 44.34% quantile in recent 10 years.
Industry news: 1. Shanghai Municipal Commission of economy and information technology issued the 14th five year plan for the development of Shanghai’s electronic information industry. The plan points out that Shanghai will develop in coordination with industries in the Yangtze River Delta, and a world-class electronic information industry cluster with global influence and competitiveness will be preliminarily built by 2025. The scale of Shanghai’s electronic information industry exceeds 2.2 trillion yuan, of which the income of software and information service industry exceeds 1.5 trillion yuan. We should strengthen the forward-looking research and development of the basic capabilities of the underlying core technologies of the meta universe, promote the development of new terminals for deepening perceptual interaction and the construction of systematic virtual content, and explore industrial applications. 2, at Baidu Create2021 (Baidu AI Developer Conference), Baidu’s chairman Robin Li judged that intelligent transportation will be a major change that will affect the next 10-40 years. It will make China’s first tier cities no longer need restriction and restriction within 5 years, and basically solve the congestion problem within 10 years. In Robin Li’s view, intelligent transportation can solve three major problems: first, reduce 90% road safety accidents. Second, the system solves the problem of congestion. Third, autonomous driving and intelligent transportation can help reduce carbon emissions. 3, at Baidu Create2021 (Baidu AI Developer Conference), Baidu CTO Wang Haifeng said that in order to further reduce the threshold of digital human application, Baidu Intelligent Cloud officially launched the digital human platform, Baidu Intelligent Cloud Xi Ling, providing various digital generation and production services for all walks of life. 4. The reorganization plan of Ziguang group was voted on. 5. Qi An Xin Technology Group Inc(688561) announced that 70 million orders were obtained for international business.
Zhou’s point of view: it is suggested to grasp the opportunities of China’s digital development and pay attention to the fields with high prosperity and growth certainty. In the medium and long term of cloud computing, SaaS penetration increases and upstream servers recover in the short term. Focus on Inspur Electronic Information Industry Co.Ltd(000977) (000977), Shanghai Baosight Software Co.Ltd(600845) (600845), Glodon Company Limited(002410) (002410), Beijing Kingsoft Office Software Inc(688111) (688111), Yonyou Network Technology Co.Ltd(600588) (600588), etc. Artificial intelligence enables enterprises to reduce costs and increase efficiency. The scenes of automatic driving and education continue to deepen, and the potential market is huge. Pay attention to Iflytek Co.Ltd(002230) (002230), Zhejiang Dahua Technology Co.Ltd(002236) (002236), Hangzhou Hikvision Digital Technology Co.Ltd(002415) (002415), etc. Securities it benefits from capital market reform, dividend release, incremental space can be expected, pay attention to Hundsun Technologies Inc(600570) (600570), etc. There are frequent favorable policies for network security, increasing demand in emerging security markets, and paying attention to Qi An Xin Technology Group Inc(688561) – U (688561), Venustech Group Inc(002439) (002439), Nsfocus Technologies Group Co.Ltd(300369) (300369), etc.
Risk tips: policy changes; Macroeconomic fluctuations affect the demand for downstream products; Technology advancement is less than expected; Intensified industry competition, etc.
