\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 728 China Telecom Corporation Limited(601728) )
Event overview: on March 17, 2022, the company released its 2021 annual report, realizing an operating revenue of 434.2 billion yuan, a year-on-year increase of 11.3%; The net profit attributable to the parent company was 25.952 billion yuan, a year-on-year increase of 24.4%; The net profit of non parent company deduction was RMB 25.044 billion, with a year-on-year increase of 19.2%.
The growth rate of revenue and profit led the industry, and the financial indicators continued to be optimized after the listing of a shares
Excluding the impact of the sale of subsidiaries, the company’s 21-year comparable service revenue was 402.2 billion yuan, a year-on-year increase of 8.1%, higher than the average growth rate of operators for five consecutive years. The net profit attributable to the parent company was 25.952 billion yuan, a year-on-year increase of 24.4%. Excluding the one-time after tax income of 1.416 billion yuan from the sale of subsidiaries, the comparable net profit increased by 17.7% year-on-year.
Thanks to performance growth and A-share financing, the company’s financial indicators continued to be optimized. In 21 years, the company raised about 47 billion yuan from A-share listing, which was reflected in the increase of monetary funds and the decrease of long-term loans. In 21 years, monetary funds increased by 42.1 billion yuan to 75.2 billion yuan, a year-on-year increase of 127.2%, and long-term loans decreased by 11.9 billion yuan to 5.3 billion yuan, a year-on-year decrease of 69.0%. In the 21st year, the company’s overall interest payment debt scale decreased from 53.3 billion yuan to 16.5 billion yuan, a year-on-year decrease of 69.1%, and the asset liability ratio decreased from 48.8% to 43.4%, a year-on-year decrease of 5.4pct, the best level since 2012.
The increase of penetration rate drives the steady growth of fixed migration income, and the digitization of industry has become the main force of growth
The growth rate of fixed income increased. In the 21st year, the revenue of mobile communication service was 184.2 billion yuan, with a year-on-year increase of 4.9%. The net increase of mobile users was 21.41 million. The net increase was the first in the industry for four consecutive years, and the 5g penetration rate was 50.4%, which led to the year-on-year increase of mobile ARPU by 2.0% to 45.0 yuan. Fixed line and smart home service revenue was 113.5 billion yuan, with a year-on-year increase of 4.1%, of which smart home revenue increased by 25.1% to 13.9 billion yuan, Gigabit broadband penetration increased by 5.9pct to 7.7% year-on-year, driving broadband access ARPU to increase by 1.3% to 38.9 yuan year-on-year.
Industry digitalization became the main force of growth, and the revenue of Tianyi cloud doubled. In the 21st year, the industrial digital revenue was 98.9 billion yuan, with a year-on-year increase of 19.4% in comparable caliber and an increase of 2.1pct to 24.6% in revenue. The target is to account for more than 30% in revenue in the next three years. Tianyi cloud’s revenue was 27.9 billion yuan, with a year-on-year increase of 102%, ranking the first camp in the industry, and the company’s IAAs + PAAS share increased by 1.6pct to 9.0% year-on-year; IDC’s revenue was 31.6 billion yuan, a year-on-year increase of 13%.
Cloud network integration takes the lead in the infrastructure industry, optimizes the capital expenditure structure, increases investment and seizes development opportunities
The company has the country’s largest IDC rack (470000) and the world’s largest ROADM all-optical transmission network. At the same time, the scale of gigabit optical network is the world’s leading (4 million 10g PON ports), which can give full play to the advantages of cloud network integration, fully promote the implementation of “East data and West computing”, and is expected to continue to lead the 2C / 2B / 2B digital transformation and upgrading.
In the past 22 years, the company’s capital expenditure guideline was 93 billion yuan, with a year-on-year increase of 7.2%, the proportion of industrial digitization increased by 10.1pct to 30.0%, and the investment amount increased by 62% to 27.9 billion yuan. Among them, IDC invested 65 trillion yuan, planned to build 45000 NEW racks, invested 14 billion yuan in computing power (cloud resources), and planned to add 160000 cloud servers. The company aims to invest accurately and strengthen the leading edge of intelligent network in order to seize the opportunity of digital economy development.
We will raise the dividend payout ratio to 60% and plan to pay interim dividends to share development achievements with shareholders
The company plans to pay a dividend of 0.17 yuan per share in 21 years, and the dividend payout rate will be increased from 40.3% to 60%. At the same time, it plans to pay an interim dividend in 22 years. The company plans to gradually increase the dividend payout rate to 70% within three years after the issuance and listing (before 2024), so as to create a good return for shareholders.
Investment suggestion: we are optimistic about the digital development potential of the company’s industry. It is estimated that the net profit attributable to the parent company from 2022 to 2024 will be 30.259349074075 billion yuan respectively, with the corresponding PE multiple of 12x / 11x / 9x, and the valuation center of the company since its listing will be 15 times. Maintain a “recommended” rating.
Risk tip: the effect of co construction and sharing is not as expected; The development of industrial digitization is less than expected
