Ziguang (000938) first coverage: Global enterprise network equipment giant 5G construction is directly called the target

Ziguang (000938) first coverage: Global enterprise network equipment giant 5G construction is directly called the target
Key elements of the report: The company’s actual controller is the Ministry of Education, and its major shareholder is the investment holding platform Tibet Ziguang Communication Investment Co., Ltd., a large state-owned high-tech enterprise group owned by Tsinghua University.According to the company’s first quarter report for 2019, the revenue and net profit attributable to mothers were 122.200 million and 3.7.7 billion, a 20% increase each year.85% and 52.66%.Driven 武汉夜网论坛 by the dual benefits of the gradual implementation of 5G construction and the uninterrupted growth rate of domestic data center construction, we believe that the company is likely to usher in a period of sustained and rapid growth in performance that exceeds the growth rate of the industry. Investment Highlights: “Growth 3.The stage of “0” is entering a period of rapid rise: The company entered the first two stages of scanner manufacturing and sales and IT product distribution, and entered the global enterprise network equipment giant Xinhua San Group (H3C) 51% in 2016.Current growth 3.Stage 0. Regardless of the industry background or H3C’s own operating performance, the company is currently in a period of rapid rise in business development and deserves special attention. H3C is the global enterprise network equipment giant 西安耍耍网 and the only Huawei in China: H3C, which is derived from Huawei’s blood, ranks first in the global market of the industry in terms of customer structure, revenue scale, profit level, and technical maturity, far ahead of domestic division HuaweiAll other manufacturers of the same type.The company’s first market-launched products, including 400G optical equipment, high-end routers, WiFi 6, and small base station solutions, are directly replaced in the context of 5G construction and future data center expansion and data center expansion.Considering the company’s industry level and market share, we believe that the company’s growth rate will exceed the industry’s development speed, and realize the excess partial benefits of deterministic substitution. Increasing research and development expenditure will inevitably promote the continuous optimization of the profit structure: and under the trend of continuous growth in company revenue, the proportion of H3C’s revenue and profit contribution to the company continues to increase at the same time, which shows that the company’s integration effect on H3C is significant.At the same time, the company continues to increase its R & D investment, and at the same time promotes the continuous improvement of sales gross profit. By comparing the gross profit structure of similar foreign companies, we believe that the company’s profitability has increased room for improvement and is expected in the future. Profit forecast and investment advice: It is estimated that the company will achieve net profit of 23 in 2019, 2020 and 2021.10 billion, 28.8.9 billion, 36.9.7 billion, the corresponding EPS is 1.13 yuan, 1.41 yuan, 1.81 yuan; corresponding to the current expected PE is 29 times, 23 times, 18 times respectively; for the first time assigned a “buy” rating. Risk factors: 5G construction fails to meet expectations, Sino-US trade frictions intensify, and the risk of goodwill impairment.