运营商开启骨干网400G 招标，公司为中标候选人2023 年10 月，中国移动开启省际骨干传送网400G OTN 新技术试验网设备集采，采购产品为400G OTN 试验网新建设备，预估采购规模为新增OTN 设备1910 台，400G 线路OTU 端口11190 个。公司中标400G OTN 试验网二平面西部标包。Key points of investment:
Leading manufacturer of optical communication equipment
The company is a scientific research and industrial entity integrating the three strategic technologies (optical communication systems and networks, optical fiber cables, optoelectronic devices) in the field of optical communication. It holds a number of optical communication companies, has mastered the core processes of independent optical fiber prefabricated rods and optical fiber production, and has a relatively complete optical communication industry chain.
The operator began bidding for the 400G backbone network. As the successful candidate, in October 2023, China Mobile began collecting equipment for the 400G OTN new technology test network for the inter-provincial backbone transmission network. The procurement products were newly built equipment for the 400G OTN test network. The estimated procurement scale was 1,910 additional OTN devices and 11,190 OTU ports for 400G lines. The company won the bid for the 400G OTN test network two-plane western package.
The operator's capital expenditure is biased towards computing power networks. According to the 2023 guidelines of the three major operators, the computing power/industrial digital capital expenses of mobile, telecom, and Unicom were 452/38/14.9 billion yuan respectively, up 35%/40%/20% year-on-year respectively. On August 20, 2023, China Telecom began collecting AI computing power servers (2023-2024). The company won the bid for three projects: I-series training air-cooled servers, G-series training air-cooled servers, and G-series training liquid-cooled servers. The winning bid shares for the I series and G series were 4.65%/15.97%, respectively.
The holding subsidiary Changjiang Computing has formed the “Kunpeng + Shengteng” dual system company Changjiang Computing, a wholly-owned subsidiary established by China Information and Communications Technology Group with the goal of matching the country's overall strategic layout and developing China's high-tech industry. Changjiang Computing has launched 5 types of computing power products, including general-purpose servers, intelligent servers, high-performance computing servers, storage products, terminal products, etc., and has become a dual system certification for Huawei Kunpeng's leading machine hardware partner and Shengteng's premium hardware partner.
Profit Forecasts, Valuations, and Ratings
We expect the company's 2024-2026 revenue to be 364.90/413.58,46.926 billion yuan, respectively, with year-on-year growth rates of 17.22%/13.34%/13.46%; net profit to mother of 6.81/9.06/1,088 billion yuan, respectively, with year-on-year growth rates of 34.74%/33.12%/20.02%; EPS of 0.57/0.76/0.92 yuan/share, respectively, and a 3-year CAGR of 29.12%. The DDM absolute valuation method measures the value of the company per share at 21.80 yuan. Combining the absolute valuation method and the relative valuation method, we gave the company 40 times PE in 2024, with a target price of 22.97 yuan. For the first time, we covered it and gave it a “buy” rating.
Risk warning: 400G backbone network construction progress falls short of expected risk; AI industry development falls short of expected risk; risk of technology development falling short of expectations; risk of US restrictions on technology upgrading and scope expansion.
