Dig deeper into opportunities for autonomous control and innovation-driven

The general background of Sino-US relations has promoted the development of the communications industry to accelerate into the key stage of upstream key chip devices and materials. The historical mission of the 5G stage is particularly prominent. The ICT industry is very urgent to upgrade to the highest level; while in the field of application innovation, cloud The continuous deepening of innovations in computing, the Internet of Things, and AI big data will also bring new investment opportunities in the communications industry.

　　

It will be the historical mission of the 5G era to achieve upstream independent controllability and promote the development of the communication industry to the highest level: the communication industry has achieved independent standards from scratch in the 3G era, and achieved global leadership in network equipment in the 4G era, while the 5G era is Under the background of achieving a more leading standard, grasping breakthroughs in upstream key chips, devices and materials will become a historical mission and a historical opportunity. From our main research on the upstream demand of the communications industry, grasping the opportunities of the three upstream tracks will become the focus. The first track is in the field of fixed-line transmission. The key breakthroughs include high-end optical module chips, switch chips, server chips, etc. At present, domestic 25G high-end optical module chips are expected to break through, and the field of switch chips and server chips is also accelerating; The second track is a radio frequency device and chip for 5G wireless applications, focusing on filters, amplifiers, ADDA, baseband chips, etc. At present, in addition to baseband chips, domestic manufacturers such as Huawei and ZTE have achieved good breakthroughs. The first three areas are basically Dominated by American manufacturers and Japanese manufacturers, the domestic industry needs to make breakthroughs in all aspects of materials, design, and wafers; the third track is the field of satellite navigation, with a focus on the development of the Beidou navigation industry, which is expected to achieve breakthroughs in high-precision positioning. 3. The rapid development of industry application fields. We believe that understanding the urgency of the historical mission from a strategic perspective and grasping the independent and controllable development and breakthroughs of the three upstream circuits of the communications industry are important investment clues for the communications industry.

　　

Promoting 5G deployment will still be China‘s strategic choice to accelerate the development of information technology and promote innovation and transformation: The Sino-US strategic game highlights the constraints of China‘s 5G development, but as the infrastructure of the information industry and innovation transformation, accelerating 5G deployment is an inevitable strategic choice . At present, the overall capital expenditure of the communications industry is in a downward channel. It is expected that 5G will bring a new capital expenditure cycle in the future. We expect that compared with the three-year peak capital expenditure in the 4G phase, the 5G era will have a 20-50% increase, promoting a new round of capital expenditure. Capital expenditure cycle. The big changes introduced in the spectrum and network architecture in the 5G era will have a greater impact on the supporting devices and network equipment of the radio frequency. After the 5G investment starts, the supporting industry chain is expected to usher in a new wave of opportunities. In the field of 5G standards, manufacturers represented by Huawei and ZTE have achieved major breakthroughs. In coding standards, core network architecture and other fields, they have greater dominance than the 4G era, which will help Chinese manufacturers to enhance global market competition in the future. Power and share. We believe that despite the influence of the Sino-US game, the logic of the 5G capital expenditure cycle has not changed. It is expected that the second half of 2018 will enter the spectrum determination phase and the license issuance phase next year. Seizing the 5G capital expenditure cycle is still a key opportunity.