The performance in 2012 was not satisfactory, looking forward to a reversal in the future:
In 2012, China Mobile Limited accelerated the construction of his TD-SCDMA network in 2012, which increased the company's TD-SCDMA antenna revenue by about 45.0% compared with 2011. In addition, due to the continuous upgrading of network technology, the situation of overseas multi-network co-stations has become increasingly common, resulting in a substantial increase in the demand for multi-band multi-system antennas, driving the company's multi-band multi-system antennas to increase by about 48.4% over the previous year. As some international equipment vendors are affected by the economic and communication competition in Europe and the United States, the procurement demand of the base station radio frequency subsystem has been greatly reduced. In 2012, the company's base station radio frequency subsystem revenue decreased by about 39.8% year on year to about 284 million yuan. Revenue from the coverage extension program increased by about 69.5% year-on-year to 132 million yuan. The company realized a loss of 39 million yuan for the whole year.
The pace of 4G construction in China is accelerating, and the prospect of the industry is optimistic:
The company's LTE product technology has been in the leading level in the domestic industry, and can directly compete with foreign counterparts, including TD-LTE and FDD-LTE. In 2012, the company has developed and sold TD-LTE and FDD-LTE products for various system equipment vendors' customers, and the products are sold to both Chinese and overseas markets, making the company occupy a leading market share and networking experience in the development of the LTE market. In antenna products, the company's multi-band and multi-system antennas have maintained growth for many years and have become the largest business unit of antenna system products, mainly due to the continuous expansion of the demand of overseas operators. We believe that with the increase of network investment in LTE, the demand for multi-network co-station will be more prominent in the future because of the shorter coverage radius of LTE base stations and the larger demand for site sites. In terms of coverage and extension products, the company successfully made a breakthrough in the landscaping antenna project of overseas operators in 2012 and obtained orders from overseas customers. This shows that the company's special coverage solution can meet the technical needs of overseas operators and is expected to have a huge growth in the future. Due to the rapid growth in demand from domestic and overseas operators, it is expected that in the coming period of time, the growth of antenna system products and beautified antenna products will be higher than the company average, and the growth of 3G, 4G and special coverage products will also be higher than the average. It is believed that profitability will also be significantly improved.
Profit Summary:
According to Bloomberg's comprehensive forecast, the company's revenue in 2013 was 1.255 billion yuan, up 82.6% from a year earlier, and its net profit was 91.9 million yuan. The share price is now trading at HK $0.87, or 6.33 times 2013 earnings per share, PE. We believe that with the gradual recovery of China's network construction and the acceleration of China's 4G network construction, we believe that the company is about to usher in a turning point and its valuation will be raised.
