The demand for optical fiber optic devices is improved
According to the Shanghai news report, according to the annual gathering pace, China mobile is expected to launch the 2018 optical fiber collection. In terms of its broadband construction, the demand for optical fiber will increase or increase in 2018. In addition, the 5G network is expected to start construction in 2019, and the transmission from the prequel will lead to new optical fiber requirements. The research institute believes that the price of optical cable is likely to be higher or higher, driven by the supply of market demand and the rise of raw materials. At the same time, the large-scale construction of data center has further enhanced the demand of optical fiber optic devices. We will focus on hengtong photoelectric, zhongtian science and technology, beacon-fire communication, guangxun technology, intermedium xu chuang, etc.
Light fast technology (exclusive access to data operation strategy)
Light fast technology: the performance continues to grow steadily, and expects the high end light module to be released
Guangxun technology 002281
Research institution: northeast securities analyst: xiong jun wrote date: 2017-10-23
The steady and steady growth of the performance was basically in line with expectations. In the third quarter of 2017, the company realized revenue of 10.11 billion yuan, down 5.55 percent from the same period last year, and its net profit was 7991.02 million yuan, up 36.92 percent year on year and 0.127 yuan per share, up 36.96 percent year on year. Decline in gross margin, in the first three quarters of integrated gross margin of 20.03%, 1.57%, sales net interest rate of 7.26%, up 0.5%, the company in revenue growth and gross margin decline in market background, by improving the management efficiency, strengthen cost control, the net interest rate of the effective implementation of sustained growth. In 2017, the forecast for full-year results showed a range of rmb285m - 371 million, with a range of 0.00%- 30.00%.
High rate light module overall demand increases, the company is expected to continue to benefit. Traffic growth promoting operators will be deployed to the province 100 g dry core layer and expansion backbone network, China telecom has launched 100 GBSDWDM backbone system expansion projects in 2017, the expansion project startup herald a domestic 100 g backbone capacity to upgrade the overall, will drive the high rate of rising demand module industry as a whole is expected in the next five years to 100 GBPS and higher rate of light module market will account for more than half of global optical device market. At present, the company is actively laying out high rate optical modules and developing important customer market. In the future, it is expected to achieve new growth with the advantage of its own technology.
The construction plan of the information optoelectronic innovation center, which is led and formed, will create a diversified innovation platform in the field of information optoelectronics. To actively respond to "made in China 2025" and promote the implementation of the strategy of manufacturing power, the company established wuhan guanggu information optoelectronics innovation center co., LTD. On January 6, 2017. Eight strategic investors were introduced on August 23, 2017, and the current construction plan has been approved by experts. Information photoelectron innovation center will revolve around a new generation of information photoelectron technology "core optoelectronic chips and devices" major key and generic technology innovation and development, promote the transformation of scientific and technological achievements, led optoelectronic information manufacturing industry development.
The profit forecast and investment advice: the company whole industry chain layout light module, attaches great importance to the r&d and continuously expand the product line, we prefer the boom of light module industry high, and the development opportunity brought by carrier transmission network upgrade requirements. The company's net profit is estimated to be 347 million, 464 million yuan, 597 million yuan, 0.55 yuan per share, 0.74 yuan and 0.95 yuan respectively, and the current share price is 45 times, 34 times and 26 times the dynamic PE, maintaining a "buy" rating.
Risk tip: light module industry is less than expected; The volume production was less than expected.
Hengtong photoelectric (individual stock data operation strategy)
Hengtong photoelectric: light communication drives the performance of rapid growth, diversified layout opens the future space
Hengtong photoelectric 600487
Research institute: zhongtai securities analyst: li wei, Chen ning yu wrote the date: 2017-08-31
Event: the company issued a semi-annual report for 2017 with a total revenue of 11.413 billion yuan, up 41.76 percent year on year, with a net profit of 767 million yuan, up 100.67 percent year-on-year. The high speed of light communication led to the growth of the company's performance, and its net profit increased by 76.4% in the second quarter. Steady growth in the domestic market, expanding overseas market actively, the company in the first half net profit surged 100.67%, just the corresponding results express the median, largely in line with expectations. In comparison with the growth of the first half of the year, the growth rate of the second quarter was 76.4%, and the growth rate was obviously accelerated. According to the disclosure of information, in the first half of the prosper prosper in optical fiber, optical network, optical fiber, the south four optical communications business, a subsidiary of total net profit of 594 million yuan, accounting for 77.4% of the company's total net income, the boom of high optical communications business, apparently, is rapid growth of the company's performance of the main driving force.
The supply of light sticks is still tight, with a lot of new production capacity in the short term, and the fiber optic fiber optic cable is expected to remain high. The boom of the fiber optic cable high by the ministry of commerce for import light great influence on anti-dumping policy, and in the anti-dumping policy is expected to continue with the expectation that, great gap between supply and demand is still difficult to fill light, accordingly, optical fiber prices is expected to continue strong, the boom of optical fiber market will also continue. According to recent industry survey results, the supply and demand of the market is still tight. From the perspective of the production of the rod, the global casing supply is basically stable, and the potential of the expansion of the optical rod capacity is very small. Outside the tube method at present most of new capacity is still in the infrastructure or ignition pilot phase, in the short term is difficult to scale, so it does not have the basis of large-scale expansion of light rods capacity, light bar of supply and demand situation in the short term is difficult to reverse. Earlier, Verizon and corning and prysmian had signed a three-year, long, high-price supply agreement, which also supported the international giant's forecast of global market supply and demand in the next three years. Market Research firm Research and markets also released a report on fiber industry Research, which is expected to grow rapidly at a compound annual growth rate of 11.45% between 2017 and 2021. We think the mobile fixed-line market don't have to worry about optical fiber after the peak period of construction risk of demand and prices, and 5 g demand pull in overseas markets are expected to maintain the boom of high optical fiber cable industry. As the domestic optical rod tap, the company has continuously improved the capacity of the optical rod, which can further reduce the cost and continue to improve profitability.
The technical advantage leads to the development of high voltage and special conductors, and the cable project has been placed into the smart ocean blue ocean market. Uhv transmission aspect, the company for the construction of the "three pay six straight" projects of all services, including the highest voltage level, the highest technical level in the world of changji - search + 1100 kV uhv projects. Special wire power bao LAN completed Gao Tiegao iron, the third generation of the super soft fire retardant cable with independent intellectual property rights, in the international leading level, in the first half of the shipment and reserve the order of one hundred million yuan. The company is one of the first in the world and the largest in the world. It has the capability of producing and delivering the submarine cable system in the world. At present, the company has announced the annual order of submarine cable projects already amounted to 761 million yuan, with gradually developed the main station, time shuttle box at the bottom of the core products, the company has swept into the ocean blue ocean market wisdom.
New businesses such as new energy, quantum communication, big data and smart communities are laid out to open up new Spaces for future growth. The company focuses on the new energy automobile industry chain, focusing on electric control and charging, accelerating the development of advanced charging technologies and developing new business models for charging. The suzhou branch of the people's bank of China, the first in jiangsu province, has been officially opened. In addition, the company in the big data, the intelligence community in the areas of advanced layout also has paid off, through the integration of industry resources, layout of the emerging business actively, also opened a new space for the company's future growth.
Profit forecast and investment advice: we expect the company's net profit to be in the period of 2017~2019 to RMB 25.0 billion yuan and 32.0 billion yuan and 3.85 billion yuan respectively, corresponding to EPS of 1.84 yuan, 2.35 yuan and 2.83 yuan respectively. We give the company a "buy" rating, with a six-month target price of 35 yuan, corresponding to the 2018 PEx15.
Risk indication: 1) the risk of fiber optic cable demand decline; 2) expansion of new business is less than expected; 3) the risk of torsion of supply and demand of light rods.
Zhongtian science and technology (individual stock data operation strategy)
Zhongtian science and technology: layout of new energy, cable and cable power
Zhongtian technology 600522
Research institution: China securities analyst: wang yichao wrote the date: 2017-09-20
Investment logic
5 g, driven by demand growth at home and abroad, continue to drive the fiber optic cable from high prosperity: optical fiber cable business good in transmission network construction, and further carried out 5 g network infrastructure construction, the three major operators to invest to build optical networks, radio and television connectivity platform 10 billion investment demand increment within five years, and jointly promote the business at home and abroad leading optical fiber cable in price rebound. On the bright side, the company's output continues to grow, but there is still a gap between supply and demand. The company has the integrated production capacity of optical fiber optic fiber optic cable, its integration layout, the production capacity matching of the three, and the advantages of VAD technology can continuously benefit the high degree of prosperity of the whole industry.
Wire and cable the winning 2 billion orders, supporting power transmission business: the rapid development of company in power transmission business to maintain industry leading position, in accordance with the state grid corporation plan, by 2020, the state grid company will be built in the eastern and western synchronous power grid, put 19 dc engineering, general form, by the end of the structure is clear, the coordinated development of ac/dc backbone network frame, the length of the line, substation (converter) capacity up to 95000 km, 8.9 kw, respectively. Recently, the company has continuously placed high orders for power lines and cables, and supported the rapid development of the power transmission business.
Policy support, the sea cable and offshore wind power business grow rapidly: in May 2017, the national seabed science observation network is officially approved, the total investment of the project is over 2 billion yuan, and the construction cycle is 5 years. The technology and products of zhongtian science and technology have been awarded many international certifications, and the business ability is the leading international level. The national energy administration has issued a number of policies to support the accelerated development of offshore wind power business. As the company implements important technological breakthroughs in products such as high voltage sea cables and connecting boxes, a complete sea cable solution will be available.
Layout of lithium batteries and photovoltaic business, new energy industry. We: zhongtian technology in the rapid growth of new energy business, lithium battery business, power battery industry competition intensifies, industry standard optimization, the company independent research and development cutting-edge technology has won international recognition; Company depending on the new direction for new energy battery energy storage battery application, vigorously promote energy storage business research and development and industrial layout, transit storage 2 billion watts of power battery when the project has been completed, and scored storage application demonstration project in jiangsu province, the business is expected to break even this year. In the aspect of photovoltaic business, the industrial demand has been growing steadily, and the company has been developing with distributed pv as its characteristic and main growth point, and the collaborative energy storage technology is developing together, and the business model is constantly innovating.
Investment advice
We believe that as the capacity of optical rod increases, the self-sufficiency of fiber optic cable is improved simultaneously. Distribution cables, sea cables and new energy will be a powerful driver of growth. Give the company a "buy" rating with a target price of 15.5 yuan.
The valuation
We expect the company's net profit for 2017-2019 to be 2.23 billion, 2.73 billion, and 3.07 billion, with EPS of 0.73,0.89 and 1.00, corresponding to 17,14,12 times PE. The risk indicates that capital expenditure of n operators is not expected;
Optical rod capacity expansion is not expected.