A listed platform in the China Telecom Communications sector, maintaining a “buy” rating
The company is a listing platform for China's telecommunications sector, which is expected to benefit from the satellite Internet and the blue ocean of the low-altitude economy. We maintain the original profit forecast and add the 2026 profit forecast. The company's net profit for 2024-2026 is 2.31, 3.23, and 388 million yuan, respectively, and EPS is 0.34, 0.47, and 0.57 yuan/share, respectively, corresponding to the current share price PE of 73.3, 52.5, and 43.7 times, respectively, maintaining a “buy” rating.
Event: Company Releases 2023 Annual Report and 2024 Quarterly Report
In 2023, the company achieved operating income of 5.463 billion yuan, a year-on-year decrease of 22.79%; realized net profit of 36 million yuan, a year-on-year decrease of 83.32%. In the first quarter of 2024, the company achieved operating income of 1,083 million yuan, a year-on-year decrease of 11.40%; realized net profit of 16 million yuan, a year-on-year decrease of 26.16%.
Forward-looking layout of satellite internet and low-altitude economy, actively building new productivity and trillion-dollar treasury bond construction have ushered in new opportunities. Digital and intelligent trends in various fields drive the downstream demand for private network communication and smart applications. A number of strategic emerging industries, such as AI computing power and low-altitude economy, are putting forward more stable and efficient communication network support, steadily driving the development of industry-oriented private network communication and smart applications. The company closely follows cutting-edge technology, strengthens tracking and layout in emerging industries such as 6G, satellite internet, and low-altitude economy, and actively builds new quality productivity.
Special PCB leader with bright growth prospects
With the steady advancement of policies such as national autonomy and control, localization and substitution, opportunities such as the localization of PCBs, high-end time-frequency devices, and special crystal oscillators in special fields are presented. The company focuses on one-stop service for PCB design, manufacturing and mounting of multiple varieties, samples and small to medium batches, short delivery, high reliability, and special requirements. It is the largest domestic special-purpose circuit board supplier and PCB supplier in the rail transit sector. It has a high-quality customer base in the communications, electricity, industrial control, security and medical industries, and is developing rapidly in the fields of satellite communications, aviation and navigation, ultra-high voltage power grids, and AI computing power.
Risk warning: Industry implementation falls short of expectations; market competition increases risk; company R&D falls short of expectations risk.