The only commercial satellite telecom operator in China. It specializes in satellite space segment operations and related services. China Satellite Communications is the only basic telecom operator in China with autonomous commercial communication and broadcasting satellite resources. It is the core professional subsidiary of the Aerospace Science and Technology Group engaged in the satellite operation and service industry. The company was listed on the Shanghai Stock Exchange on June 28, 2019, with a market value of 69.1 billion yuan on February 7. The controlling shareholder, Aerospace Science and Technology Group, holds a share ratio of 79.73%. The company is mainly engaged in satellite space segment operation and related application services. It provides users with communication/radio and television transmission through investment, construction, and operation of communication/broadcast satellites and supporting systems. The two major application scenarios include: (1) satellite communication and emergency support services (2018 revenue of 1,463 billion yuan, accounting for 54%), and (2) satellite radio and television service business (2018 revenue of 1,017 billion yuan, accounting for 38%). The company's signal coverage includes: all of China, Australia, Southeast Asia, South Asia, the Middle East, Europe, Africa and other countries and regions. A satellite operation service leader with an absolute advantage. It has a total headquarters and two satellite operation assets company, and a total of two assets are in operation in the satellite space segment operation business. In addition to the company headquarters, its subsidiary Asia Pacific Communications is also engaged in satellite operation service business, mainly covering overseas regions. In 2018, the company's domestic business accounted for 63%, and overseas business accounted for 37%. According to the company's prospectus, the company's domestic market share is currently as high as 80%, and the remaining 20% is mainly for CITIC Network to develop business through fixed assets of Asian satellites actually controlled by the company. The company has an absolute competitive advantage in the domestic market. Over the past 5 years, the company's overall revenue has been stable, and profitability has gradually rebounded. In 2018, the company's total revenue was 2.69 billion yuan, +2.8% year on year, net profit margin of 4.2 billion yuan, +7.4%, gross profit margin of 44%, net profit margin of 27.7%; in the first three quarters of 2019, the company's revenue was 1.93 billion yuan, a slight decrease of 0.9% year on year, but net profit margin of 3.1 billion yuan, +22.4%, gross profit margin of 37.7%, net profit margin of 25.1%. Seize the opportunities of satellite Internet and provide cost-effective, ubiquitous satellite broadband coverage There is a huge gap in the level of global Internet access. Nearly half of the population is below 3G or has no Internet coverage. Currently, the growth rate of Internet penetration has clearly slowed down. In February 2019, the Internet penetration rate increased by only 1.7%, and in low-income countries by only 0.8%. Traditional communication backbone networks are difficult in regions with low population and Internet penetration, which may mean that the return on investment of operators is disproportionate, causing barriers to popularity. Low-orbit satellite Internet is expected to become the core solution for global connectivity, and the pioneer Starlink is expected to promote domestic satellite Internet construction. Currently, the plan will initially launch 12,000 satellites, with a total number of subsequent launches of 42,000 satellites. In January of this year, 120 satellites have already been launched. We expect China to establish 1-2 world-class satellite Internet companies (manufacturing and service). According to our estimates in the in-depth PPT “Satellite Internet Depth 2”, China may need to enter orbit 11,000 satellites within 8 years, and the market demand space for satellite applications will reach about 25 billion yuan by 2028. Based on this, we calculated the company's medium- to long-term revenue and growth rate for 2022-2028, and calculated the final target market value range of 951 to 104.8 billion yuan, target price range of 23.77 to 26.2 yuan, and space of 29.3% to 42.4%. Additionally, we recommend. After the initial implementation of the company's Internet satellite business, a cloud-biased computing PS valuation method can be used. Profit forecast and rating: Revenue for 19-21 is expected to be 28.6/32.0/40.0 billion yuan, a growth rate of 6%/12%/25%, net profit of 4.6/5.6/740 million yuan, EPS of 0.12/0.14/0.19 yuan, and PE of 159/131/99x, covering the first purchase rating. Risk warning: China's satellite Internet launch progress is lower than expected, the company's satellite Internet service implementation has slowed down, and the new business and downstream agreement and cooperation methods have yet to be determined.