\u3000\u3 Guangdong Shaoneng Group Co.Ltd(000601) 728 China Telecom Corporation Limited(601728) )
Core view
Double digit growth in revenue and profit in 2021. The company achieved operating revenue of 439.6 billion yuan (+ 11.7%) in 21 years; The net profit attributable to the parent company was 25.95 billion yuan (+ 24.4%). Among them, the revenue of 21q4 was 107.62 billion yuan (+ 8.6%), and the net profit attributable to the parent company was 2.625 billion yuan (+ 22.1%). A cash dividend of RMB 0.170 (tax included) is distributed per share, corresponding to the dividend rate of the current stock price of about 4.2%. The performance is in line with expectations.
Revenue side: (1) the number of 5g users increased significantly, and the ARPU value increased steadily. The company's 5g users increased by 101 million (+ 117%), and the 5g tariff reduction attracted the number of 5g users to increase the penetration rate to 50.4%, which is in the leading position in the industry; (2) The scale and value of fixed line broadband have increased. The broadband service volume reached nearly 45.7% of the total price (+ 140.7% of the total price of the cable users), and the total value of the broadband service reached nearly 140 million. Smart home business became the company's key investment in the new blue ocean market, with a year-on-year increase of 25.1%. (3) The scale of industrial digital revenue is nearly 100 billion. The "cloud to digital conversion" has achieved remarkable results. The business income of the company in this block reached 98.9 billion yuan in 21 years, (+ 19.4%). Among them, the revenue of Tianyi cloud doubled, ranking the first camp in the industry.
Cost side: (1) 5g construction has passed the peak period, and the cost side pressure begins to ease. The company's 21-year capital expenditure was 86.72 billion yuan, of which the proportion of mobile network expenditure decreased by 1.2p p. Depreciation and amortization expense was 92.97 billion yuan (+ 3.0%). The depreciation and amortization scale has exceeded the capital expenditure of the current year, and the company's assets are gradually becoming "light". (2) Pay attention to the high-quality operation of the network, and the operation cost has increased. The operating cost of the company in 21 years was 307.34 billion yuan (+ 12.9%), of which the operation and maintenance and energy consumption expenses increased by 11.6% / 11.0% respectively. (3) Continue to increase R & D investment. The company's 21-year R & D expenditure was 6.93 billion yuan (+ 46.4%), mainly due to the company's strengthening of scientific and technological innovation, increasing the introduction of high-tech talents, and strengthening the R & D of core technologies such as cloud network integration and 5g.
Give full play to the advantages of cloud network integration and turn the industry into the main force of growth. The company actively grasps the development trend of digital economy. Continue to increase investment in industrial digitization. It is estimated that the investment in industrial digitization will be 27.9 billion yuan in 22 years, an increase of 62% year-on-year. 45000 new racks and 160000 cloud servers were added.
Fulfill the listing commitment and gradually increase the dividend payout rate. The company plans to increase the dividend payout rate from about 40% in 20 years to 60% in 21 years, with a dividend of 0.17 yuan per share, corresponding to about 4.2% of the current share price. The company has fulfilled its dividend payment commitment for 21 years. According to the company's profit growth momentum and commitment at the time of listing, the dividend payment rate of the company is expected to gradually increase to 70% in the next two years.
Risk warning: 5g development is not as expected; The development of innovative business is less than expected; The impact of the epidemic has intensified.
Investment suggestion: we believe that under the background of "digital economy", the company will continue to promote the "cloud to digital" strategy and increase investment in industrial digitization, which will promote the rapid development of industrial digitization business. At the same time, the ARPU value of mobile and broadband services is no longer under pressure, and this part of services is developing steadily. Maintain the profit forecast. The net profit attributable to the parent company in 22-24 years is 29.2/336/37 billion yuan, corresponding to PE is 13 / 11 / 10x, and maintain the "buy" rating.
