For financial IT, digital renminbi has brought increments to IT construction in the links of issuance, operation, and circulation payment, mainly involving system construction, IT services, POS machines, and the upgrading of ATM machines.
The digital economy welcomes the policy east wind.
On February 8, the People’s Bank of China, the State Administration for Market Regulation, the China Banking and Insurance Regulatory Commission, and the China Securities Regulatory Commission issued the “14th Five-Year Plan for Financial Standardization”, proposing to steadily promote the construction of financial technology standards.
Boosted by this news, the concept of digital currency, Internet finance, and cloud computing continued to rise that day.
On February 9, the digital currency carried the banner of leading the rise, and the sector set off a frenzy of daily limit. Cuiwei shares (603123) and Hengbao shares (002104) 4 consecutive boards, multiple shares 20CM daily limit.
On February 10, Cuiwei shares (603123) broke the board, Hengbao shares achieved 5 consecutive boards, Jincai Internet (002530), Zhengtong Electronics (002197), Yuyin shares (002177) and other stocks daily limit.
Institutional analysts believe that “digital innovation leads development capabilities to be greatly improved, the integration of digital technology and the real economy has achieved remarkable results, the digital economy governance system has been improved, and the competitiveness and influence of my country’s digital economy has steadily increased.”
“Nuggets” Core Industry Investment Opportunities
Some brokerage analysts said that the release of the “Plan” once again provided strong support and a specific realization path for the construction of “Digital China”. “Digital China” has entered a period of comprehensive construction, and related industries have entered a period of rapid development.
At the individual stock level, Guosen Securities analyzes investment opportunities in the digital economy from four directions: digital renminbi, industrial digitalization, and agricultural digitalization.
It is understood that the digital renminbi, which is the cornerstone of the digital economy, is advancing in an orderly manner. At present, the “10+1” pattern of digital RMB pilots in 10 cities and the Winter Olympics has been formed, and the pilots involve all aspects of life.
For financial IT, digital renminbi has brought increments to IT construction in the links of issuance, operation, and circulation payment, mainly involving system construction, IT services, POS machines, and the upgrading of ATM machines. Judging from the inventory situation of various bank IT companies, industry companies are in a state of high business prosperity.
Guosen Securities pointed out that the companies involved in this field mainly include: Yuxin Technology (300674), Gao Weida (300465), Changliang Technology (300348), Jingbei (002987), Tianyang Technology (300872), Newland (000997), Xinguodu (300130), Radio and Television Express (002152), etc.
In addition, Guosen Securities also stated that industrial digitization meets the needs of manufacturing transformation. “In the context of rising labor costs in the manufacturing industry and the transformation of the country’s economic structure, industrial digitization is imperative.”
Industrial digitization, the design link before production is mainly reflected in the field of R&D and design software. In this field, my country is in the process of domestic substitution. In the production link, it is mainly reflected in the field of MES and the industrial Internet. MES is the core of intelligent manufacturing and the industrial Internet converges. AI and big data capabilities are new upgrades of MES.
Among them, the companies involved in industrial digitalization mainly include: Zhongwang Software (688083), UFIDA Network (600588), Baosight Software (600845), Zhongkong Technology (688777), Nenke Technology (603859), Saiyi Information (300687) and Tech University of Technology (688367), etc.
It is worth mentioning that the recent agricultural digitization has been mentioned more than before, and the policies are constantly favorable. The main connotations of agricultural digitalization include smart agriculture, rural e-commerce, new rural business formats, rural technological innovation supply, and rural digital inclusive finance.
For this sector, Guosen Securities pointed out that the digital application in the agricultural field is still in the exploratory stage, and some companies have given priority to exploration, such as the Yinnong direct connection system of China Information (000555) and the agricultural digitalization of Huichen (688500). SaaS solutions.
In addition, the development prospects of government digitalization are also worth looking forward to. According to the “14th Five-Year Plan” digital economy plan, the real-name users of online government services are expected to increase from 400 million users in 2020 to 800 million users in 2025.
Guosen Securities believes that in the process of digitalization of government affairs, informatization manufacturers focusing on the field of government affairs will benefit. The companies involved mainly include Xindian Software (688232) and Bosi Software (300525).
Telecom operator value is expected to reshape
In addition, with the advent of the digital economy era, many brokerage practitioners told the 21st Century Business Herald reporter that the valuation of telecom operators is also expected to be reshaped. It is reported that on February 9, China Mobile (600941), which was once on the verge of breaking service, unexpectedly increased its daily limit, which became a major event in the capital market for the Year of the Tiger.
According to the analysis of the China Securities Investment Research Report, in recent years, telecom operators’ industrial digital services for government and enterprise customers have grown rapidly. In the first half of 2021, China’s telecom industry’s digital business revenue was 50.1 billion yuan, a year-on-year increase of 16.8%; China Mobile’s DICT revenue was 33.4 billion yuan, a year-on-year increase of 59.8%; China Unicom’s industrial Internet business revenue was 28 billion yuan, a year-on-year increase of 23.6%.
“Among them, the cloud business of telecom operators has grown rapidly. In the first half of 2021, China Telecom (601728), China Mobile, and China Unicom (600050) achieved revenue of 10.3 billion yuan, 9.7 billion yuan, and 2.8 billion yuan respectively, a year-on-year increase of 122%, 118.1%, 38.9%.” The research report of CITIC Construction Investment believes that industrial digitization is in the ascendant, and the telecommunications operators’ “14th Five-Year Plan” period is still expected to maintain rapid growth in industrial digitization business, and the value needs to be reassessed.
Guojin Securities analyst Luo Lu believes that China Mobile’s fundamentals are showing a trend of improvement. The period of strong regulation on operators that began in 2011 is coming to an end. With the repositioning of central enterprises to become national strategic scientific and technological forces, the policy ceiling space is expected to be opened. In the 5G era, the industry cycle attributes are weakened, the pressure on capital expenditure is reduced, and the operator’s investment intensity (Capex/Revenue) will gradually decline from the peak value of 41% to around 20%.
“At the same time, operators have entered the era of stock operation, the pressure of oligopolistic competition has weakened, price competition has no business foundation, and the company’s ARPU value has achieved a bottom-up recovery. In the digital economy era, with the ecological changes of the ICT industry, the company will move from ToC to ToB. HBN in 2025 (Family, government enterprises and new business) revenue is expected to account for 50%, and H/B/N business is expected to grow by 81.37%, 121.08%, and 181.41% from 2021 to 2025,” she said.
Guosheng Securities also stated that after the digital economy is set, the communications industry, as a supporting industry that provides data transmission for the society, will become the hardware base of the digital economy. Subsequent substantial growth in traffic is a deterministic direction, and continuous construction and expansion of supporting infrastructure is a rigid demand. , with high certainty in the next 3-5 years. Both the telecom side and the datacom side will benefit from the sustainable development of the digital economy.
In terms of investment advice, Guosheng Securities recommends paying attention to: core asset operators China Mobile, China Telecom, China Unicom; high-quality leading companies on the traffic carrying side: Eosun (300502), Tianfu Communication (300394), Zhongji Innolight (300308) ; Internet of Things high prosperity and high growth companies Meige Intelligent (002881), Guanghetong (300638), Yealink Networks (300628); Green communication related companies Zhongtian Technology (600522), Hengtong Optoelectronics (600487), Invic (600487) 002837); IDC field Aofei Data (300738), Kehua Data (002335), Sinnet (300383). And ZTE (000063) and StarNet Ruijie (002396) in the field of communication infrastructure. Nenke Technology in Industrial Internet (603859).
In terms of the industrial chain, Haitong Strategy held the view at the end of January that according to the announcements of listed companies that have disclosed the 2021 annual report performance forecast and express report as of January 25, the overall digital economy industrial chain will return to the parent in the fourth and third quarters of 2021. The two-year annualized growth rate of net profit was 65% and 35% respectively.
The development of the digital economy has entered the deep water area
At present, the digital economy is becoming a key force for reorganizing factor resources, reshaping the economic structure, and changing the competitive landscape.
Previously, on January 14, the State Council issued the “14th Five-Year Plan for the Development of Digital Economy” (referred to as the “Plan”), proposing that “by 2025, the added value of the core industries of the digital economy will account for 10% of the GDP”. development Goals.
From the content of the “Planning”, it has deployed “optimizing and upgrading digital infrastructure, giving full play to the role of data elements, vigorously promoting the digital transformation of industries, accelerating the promotion of digital industrialization, continuously improving the level of digitalization of public services, and improving the digital economy governance system”, etc. Eight tasks.
The “Plan” also clarifies the main indicators for the development of the digital economy: by 2025, the number of active IPv6 users will reach 800 million; the number of gigabit broadband users will reach 60 million; the scale of software and information technology services will reach 14 trillion yuan; industrial Internet The platform application penetration rate reached 45%; the national online retail sales reached 17 trillion yuan; the scale of e-commerce transactions reached 46 trillion yuan; the number of real-name users of online government services reached 800 million.
According to the “China Internet Development Report 2021” released by the China Cyberspace Research Institute, the scale of China’s digital economy will reach 39.2 trillion yuan in 2020, a year-on-year increase of about 9.7%.
From a macro perspective, the development of the digital economy and international competition and cooperation have become the key strategic development directions of my country’s “14th Five-Year Plan”, and local governments have successively issued specific development plans for the digital economy and the Metaverse.
According to the Economic Information Daily, local two sessions have been held in succession recently, and the digital economy has become a “hot word” in government work reports in many places. Many places are accelerating the deployment of new infrastructure construction to consolidate the foundation for the development of the digital economy, while focusing on areas such as big data, artificial intelligence, and ultra-high-definition video, cultivating digital industrial clusters, and accelerating the creation of a highland for the development of the digital economy.
Shanxi Securities pointed out on February 9 that it is recommended to seize the investment opportunities under this trending opportunity, combine the specific cyclical and growth characteristics of the sector, and focus on the layout from the aspects of technical advantages and performance redemption capabilities.
(Author: Lei Chen Editor: Zhu Yimin)