Event: on January 19, China Unicom issued the announcement on the change of Accounting estimates and the operating situation in 2022, and the company adjusted the estimated net salvage rate of optical cable assets. This change in accounting estimate will be handled by the applicable method in the future, without retroactive adjustment, and will not affect the financial report disclosed by the company; it is expected to increase the depreciation of the company's fixed assets by about 2.35 billion yuan in 2022, affecting the net profit attributed to the parent company of about 770 million yuan in 2022.
It is expected that the net profit of returning home will reach a new high in the past three years: referring to the situation of operators in the same industry, in order to more accurately and properly reflect the use of fixed assets, the company has adjusted the estimated net salvage rate of optical cable assets from 3% to 0%. After considering the impact of this change in accounting estimates, the company expects that the year-on-year growth rate of net profit belonging to the parent company in 2022 will still be the highest in the past three years (10.82% in 2020 and 14.20% in 2021), reflecting the obvious improvement of the company's performance.
The development of basic business is steady and good: in the first three quarters of 2022, China Unicom 5G package users reached 200 million, driving the company's mobile main business revenue to 127.36 billion yuan, up 3.3% from the same period last year. As of December 2022, the number of users of China Unicom "Dalian connection" reached 862 million, an increase of 0.94% month-on-month. Among them, the number of 5G package users increased by 3.271 million a month to 213 million, an increase of 1.56% from the previous month.
Industrial Internet is the first driving force of performance growth: in the first three quarters of 2022, the company's industrial Internet achieved revenue of 53.15 billion yuan, a substantial increase of 29.9% over the same period last year, contributing more than 22% of the company's main business income, and has become the first driving force of performance growth. Among them, Unicom accelerated its development, achieving revenue of 26.87 billion yuan, an increase of 142.0% over the same period last year and an increase of 12.9% over the same period last year. At the end of 2022, the new joint venture between Unicom Venture Capital and Tencent Industry Capital was approved, and the new joint venture is mainly engaged in content distribution network (CDN) and edge computing business. In combination with the head Internet manufacturers, the three major operators represented by China Unicom have helped the overall digital upgrading of the industrial chain in the form of "industry + capital" and created a mutually beneficial and win-win industrial ecosphere. Become the main helmsman of the coordinated development of the industrial chain of the digital economy.
Profit forecast and rating: based on the obvious improvement of the company's performance and the strong driving force for the development of the industrial Internet business, which promotes the rapid growth of the company's performance, we raise our performance forecast for 2022-2024, and the estimated net profit is 100 million yuan in 73-84-90, EPS is 0.24 EPS is 0.27max 0.29 yuan, the corresponding PE is 23-20-18 times, we continue to be optimistic about the future development of China Unicom, to maintain the "buy" rating.
Risk hints: the development of industrial digitization is not as expected; the penetration rate of 5G users is not as expected; the market competition is intensified; the risk of user loss.