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Fire Communication (600498): 18-year Express Report Meets Expectations 19-Year Industry Prosperity Up

Fire Communication (600498): 18-year Express Report Meets Expectations 19-Year Industry Prosperity Up

Highlights of the report Event description On the evening of March 11, Fiberhome Communications released a performance report and achieved 杭州夜生活网 revenue of 242 in 2018.

3.6 billion, an increase of 15% in ten years; net profit attributable to mother 8.

42 trillion, an increase of 2% in ten years.

Incident review revenue growth remained high, overseas markets may be a highlight: the company achieved revenue of 242 in 2018.

USD 3.6 billion, an annual growth of 15%, of which 68 in the fourth quarter.

650,000 yuan, an increase of 14% in ten years.

Compared with the first three quarters, the company’s fourth-quarter revenue growth rate remained high.

Under the influence of the actual operator’s capital expansion in 2018, the company’s revenue has maintained a growth rate of 15%, which is not easy. We believe that the company’s overseas market may maintain rapid growth, which is the operating highlight.

The initial net profit increased by 2%, and the fourth 杭州桑拿 quarter results were slightly broken down, or due to the increase in expenses: we believe that the company’s long-term return to net profit increased by 2.

05%, of which quarter 7 quarter.

62%, mainly due to the fourth quarter divided by the distribution of incentive costs amortization, supplementary cost amortization policy changes, while the 5G R & D expenditure increased.

In the first year of 5G commercialization, 5G transmission network tendering is about to start: 2019, as the first year of 5G commercialization, transmission network construction is a step ahead, and 5G transmission network tendering is about to start.

In addition, the State Council recently issued a diversified approval for the construction of trunk transmission networks. For the 5G commercial transmission network to be deployed on a large scale, the cancellation of the approval process will accelerate the acceleration of operators’ new round of investment and upgrade of 5G backbone transmission network deployment. The company serves as internal optical communications.The efforts of the leader are first to benefit.

Optical fiber and cable pursue stable development, counter-cyclical and counter-trends become the leader: For the company, the optical fiber and cable business is mainly for the operator to develop business in the market (the profit contribution in 15-17 is not large).Ranking first in the country).

Considering that the contribution of the optical fiber and cable business to the company’s performance has been stable for many years, and Beacon won the first allocation in the China Mobile 2019 optical cable tender.

58%, an increase of 14 over the previous period.

2pct, exceeding market expectations, we believe that the current volume and price of China Mobile’s fiber optic cable collection has fallen, which has limited impact on the company’s performance.

Investment proposal: Gradually realize the full acceleration of 5G construction, the transmission network investment is about to start, the industry is booming, and considering 5G commercial use and the company’s equity incentive conditions, the company’s performance is expected to achieve scale explosion in the next two years.

We expect the company’s net profit for 2019-202010.

09 billion, 12.

6.1 billion, higher than the growth rate of 20%, 25%, corresponding to PE is 39 times, 31 times, the key recommendation, maintain the “Buy” rating.

Risk Warning: 1.

5G commercial use is less than expected; 2.

The 5G transmission network upgrade was less than expected.