China Unicom (600050): Hybrid reform promotes efficiency, edge computing promotes network value, and establishes heavy farming network

China Unicom (600050): Hybrid reform promotes efficiency, edge computing promotes network value, and establishes heavy farming network

First, the mixed reform continues to advance, efficiency is improved, and users continue to grow under fierce competition. The user is the core of the operator. Under the fierce competition, China Unicom’s operator data has continued to improve, and the mixed reform effect has appeared.

China Unicom’s January 19 business data: 4G subscribers totaled 22,283.

90,000 households, a net increase of 291.

40,000 households; fixed-line broadband subscribers gradually reached 8,150.

70,000 households, a net increase of 62.

70,000 households.

The number of new 4G users of China Unicom has continued to increase in the past two years.

It is mainly the Internet cards and unlimited packages launched by China Unicom and Internet companies that rely on the market advantages of specific customer groups to gain user growth.

Second, profitability has been restored, driven by high-performance incentives, and the company’s performance is expected to grow. Since 2017, the company’s revenue has resumed growth, while its net profit has rebounded significantly.

In 2018, the company issued the first-term ending stock incentive plan, which included no more than 7,855 employees including middle and senior management personnel, core management personnel and professional personnel who have a direct impact on the company’s operating performance and sustainable development.

From the perspective of unlocking stock incentives, the ROE requirements for 2018-2020 are 2% and 3, respectively.

9% and 5.

4%, the return on net assets will grow higher each year, and the next improvement in efficiency is expected to quickly resume profitability.

Third, borrowing the pipelined trend of edge computing to increase the value of operators’ networks into the 5G era, edge computing will become an important battlefield for operators to integrate pipelines.

Edge computing has become an important part of 5G networks, and operators are bound to lead the development of edge computing.

At the same time, operators will be able to enter the value-added service 西安耍耍网 fields outside the traffic through edge computing, such as connected cars, VR / AR, industrial control and other fields, to share profit margins.

China Unicom launched a MEC edge cloud pilot in 15 provinces and cities in China in 2018.

In 2019, Yunji Smart, a joint venture company established by the company and Wangsu Technology, was established to focus on expanding edge computing business.

Fourth, large-scale heavy farming and deepening of 4G networks, the 5G + Internet of Things era of China Unicom pattern aims to improve the release of China Unicom weapons41.

Candidates of 60,000 LTE base stations (LTE900 and LTE1800 base stations) will be announced for large-scale re-cultivation and strengthen 4G network coverage.

The number of tenders is expected to be the largest, and China Unicom’s current network is continuously improved.

At present, the main length used by China Unicom’s LTE network is 1800 MHz. After years of construction and optimization of the LTE network, a data service network with better coverage and quality has been formed, but there is a problem of deep coverage under the influence of high-rise buildings.And some remote rural areas have not yet covered the LTE network, the first release of heavy farming will effectively improve the company’s 4G network.

In the coming 5G era and the rapidly developing era of the Internet of Things, China Unicom has kept a fast track in the process, and the earlier 4G era has promoted improvement.

Fifth, profit forecast and forecast The company will promote efficiency improvement under the promotion of mixed reform, and its performance is expected to return to growth; the future 5G era is expected to bring edge computing to enhance the value of pipelines.

It is expected that the company’s EPS for 2018-2020 will be 0.

14, 0.

20 and 0.

29 yuan, give “overweight” rating.

Risk warning: Operator competition intensifies; CAPEX rises; Number portability policy is promoted;