Key investment points:
This month, CITIC computer index fell 10.56%, underperforming the market by 4.49 percentage points and outperforming the gem by 2.86 percentage points, ranking 21st among 30 CITIC primary industries. 46 stocks rose, 247 fell, mainly down. Among related concepts, electronic ID card rose by 8.67%, while other concepts mainly fell below. On March 31, the TTM overall method (excluding negative value) valuation of CITIC computer industry was 43.23 times, significantly lower than all medium and long-term average levels.
Data: (1) in 2021q4, the overall scale of China’s IT security hardware market was US $1.54 billion, with a year-on-year increase of 9.25%, which was lower than expected. In 2021, China’s IT security hardware market reached US $3.77 billion, with a year-on-year increase of about 15.2%, an increase of 9.1 percentage points over the previous year, and achieved good results under the background of the epidemic. (2) In 2021, the proportion of UFIDA cloud business revenue in ERP (cloud services and software) business increased from 45.8% to 61.6%, while the proportion of Kingdee cloud business revenue increased from 57% to 66.1%, and the proportion of Mingyuan cloud business revenue increased from 51.09% to 61.20%.
Judging from the market in March, it is generally lower than expected. From the situation of the two sessions, the favorable policies for the digital economy mainly focus on the concepts related to electronic ID card, which is lower than the market expectation as a whole. In addition, the epidemic situation in developed regions represented by Shenzhen and Shanghai in China made the market worried about the overall economic development and long-term national anti epidemic policies, which had a great negative impact on the overall market. However, we can see from the policy changes of epidemic prevention in Shanghai that the state is still very firm in its determination to the dynamic clearing strategy. We believe that after the victory of this round of anti epidemic in Shenzhen, other regions represented by Shanghai will also win the victory of epidemic prevention, which will lead to the repair of the market.
From the published results, the trend of industry leading companies to increase R & D and personnel investment is very obvious, in order to grasp that digitization and localization are bringing new opportunities to the industry, which will have a negative impact on the profits of Listed Companies in the short term, but it is conducive to the long-term development of relevant companies and obtain a more powerful competitive position in the long term. Considering the current valuation level of the industry, we believe that the space for subsequent industry adjustment is relatively limited.
This month, affected by the Russian Ukrainian war, major European and American technology companies suspended their business in Russia. At the same time, Russia announced the provisions on the use of domestic software in key fields in 2025, which means that the development of localization of information technology in large countries will become an important global trend, which will benefit the domestic basic software and hardware and the concept of information innovation for a long time.
Recommended targets of this month: Venustech Group Inc(002439) ( Venustech Group Inc(002439) ), Guangdong Tecsun Science & Technology Co.Ltd(002908) ( Guangdong Tecsun Science & Technology Co.Ltd(002908) ). Risk warning: uncertainty of international situation; The upper reaches of enterprises cut spending under inflation; Local debt risk release; The epidemic development exceeded expectations.
