Industry news: on January 12, the State Council issued the “14th five year plan” for the development of digital economy (hereinafter referred to as the “plan”), and the digital economy is moving towards an all-round expansion period. The plan defines the guiding ideology, basic principles, development objectives, key tasks and safeguard measures for the development of digital economy during the 14th Five Year Plan period. Focusing on the eight key tasks of optimizing and upgrading digital infrastructure, giving full play to the role of data elements, vigorously promoting industrial digital transformation, accelerating digital industrialization, continuously improving the digital level of public services, improving the digital economy governance system, strengthening the digital economy security system, and effectively expanding international cooperation in the digital economy, The plan defines eleven special projects, including the optimization and upgrading of information network infrastructure, the digital transformation and upgrading of key industries, and the improvement of digital economy governance capacity.
The conditions are gradually mature, and the construction of Digital China drives the rapid development of the industry: from the development process and the promotion of various supporting industrial environments, the accelerated and comprehensive construction of “Digital China” has quite mature basic conditions, which is the general trend of China’s modernization process. In October 2020, the Fifth Plenary Session of the 19th CPC Central Committee will include accelerating the construction of “Digital China” in the 14th five year plan and the long-term goal of 2035. The “two sessions” held in March 2021 once again included the construction of “Digital China” in the government work report as an important content of the 14th five year plan, marking the rise of digital construction to a national strategy. In April 2021, the fourth digital China Construction Summit was held, during which 523 projects were signed, with a total investment of 318.8 billion yuan. The release of the plan once again provides strong support and specific implementation path for the construction of “Digital China”. The “Digital China” has entered a comprehensive construction period and related industries have entered a period of rapid development. The plan points out that by 2025, the proportion of the added value of the core industries of the digital economy in China’s GDP will increase from 7.8% in 2020 to 10%; The scale of software and information technology service industry increased from 8.16 trillion to 14 trillion; The application penetration rate of industrial Internet platform increased from 14.7% to 45%; The national online retail sales increased from 11.76 trillion to 17 trillion; The number of real name users of online government services increased from 400 million to 800 million.
Investment suggestions: from the perspective of national government standard, focus on four directions from the ideological suggestions of top-level planning:
1. Digital government is the core base of “Digital China”. Enterprises that contribute to the government’s digital infrastructure will take the lead in benefiting. It is recommended to recommend Beijing Kingsoft Office Software Inc(688111) , Taiji Computer Corporation Limited(002368) , Beijing Tongtech Co.Ltd(300379) , Unisplendour Corporation Limited(000938) , and pay attention to Beijing E-Hualu Information Technology Co.Ltd(300212) , Inspur Electronic Information Industry Co.Ltd(000977) , Wonders Information Co.Ltd(300168) ;
2. Digital industry. Industrial digitization is an extension of “digital government”. Enterprises that realize digital transformation for enterprises deserve attention. It is recommended to pay attention to Hundsun Technologies Inc(600570) , Glodon Company Limited(002410) , Beijing Seeyon Internet Software Corp(688369) , Shanghai Weaver Network Co.Ltd(603039) , Zhejiang Supcon Technology Co.Ltd(688777) , Zwsoft Co.Ltd(Guangzhou)(688083) , Beijing Longruan Technologies Inc(688078) , Hefei Gocom Information Technology Co.Ltd(688367) , and it is recommended to pay attention to Beijing United Information Technology Co.Ltd(603613) , Ygsoft Inc(002063) , Winning Health Technology Group Co.Ltd(300253) , Guangzhou Sie Consulting Co.Ltd(300687) ;
3. Information security is an inevitable requirement after the accelerated development of “Digital China”, which is on the eve of rapid development. It is recommended to Topsec Technologies Group Inc(002212) , Qi An Xin Technology Group Inc(688561) , Sangfor Technologies Inc(300454) , Dbappsecurity Co.Ltd(688023) , and pay attention to Jilin University Zhengyuan Information Technologies Co.Ltd(003029) ;
4. Internationalization of digital economy. The “Introduction” and “going out” of digital economy will give birth to new market demand for industrial chain companies. Companies related to digital currency infrastructure construction have good development opportunities. It is suggested to pay attention to Xgd Inc(300130) , Grg Banking Equipment Co.Ltd(002152) , Lakala Payment Co.Ltd(300773) , Shenzhen Sunline Tech Co.Ltd(300348) , Yusys Technologies Co.Ltd(300674) .
Risk analysis: the development process of digital economy is less than expected, the implementation of policies is less than expected, the development quality of digital economy is lower than expected, and the innovation ability in key fields is insufficient.
