This report is read as follows:
Relying on the advantages of license plate, user, entrance and so on, the company binds Ali system to realize the balanced development of new media and traditional media, seizing the big screen entrance of smart family, while constantly exploring the application scene of radio and television advantage intelligent government digital platform.
Main points of investment:
Cover for the first time, the target price is 11.48 yuan, increase the rating. Relying on the advantages of license plate, user and entrance, the company deeply binds the Ali system, realizes the balanced development of cable TV, new media and smart city business, and comprehensively develops the family / business / government application scene under the background of 5G + intelligent radio and television. It is estimated that 2019-2021 EPS0.51/0.55/0.58 yuan will be given a valuation 22.5xPE of the average level of comparable companies in 2019, corresponding to the target price of 11.48 yuan, covering for the first time and giving an overweight rating.
Balanced development of CATV / new media / broadband and smart city services. The company is the first listed company in China to have a full license for both cable network and new media operation. Cable network now mainly operates in Hangzhou area. At the same time, the company conforms to the trend of triple play and relies on superior resources to adopt the strategy of bundling broadband network services with cable TV and new media business to achieve differential competition. In addition, the company announced plans to acquire Zhejiang Huasu and Ningbo Huasu. After the completion of the acquisition, the integration of radio and television network resources in Zhejiang Province will be basically realized and the scale effect will be realized. In the new media business, the company's OTT terminals cover more than 100 million units and activate more than 80 million VOD users. Ji Ke and Smart City business strives to build a smart city digital application platform covering social governance, livelihood services, industrial development and other fields, and promote the rapid landing of smart applications such as "city brain, smart government, smart community, smart security, smart campus".
Deeply bind BABA to achieve high-quality resource complementarity. On the B side and G side, the company starts with smart city and smart government affairs to cooperate with Aliyun in LoRaWAN network construction, smart city, smart home and many other fields; on the C side, the company relies on the advantages of license plate and large screen entrance of family living room to complement BABA's entertainment content in multiple channels such as cable network interactive TV / IPTV/OTT, and continues to expand the large screen user market under the background of smart family.
Catalyst: the number of IPTV/OTT users continues to grow, and the integration of the national network has landed.
Risk hint: the development of IPTV/OTT industry is not as expected, and the progress of national network integration is not as expected.