China Unicom (600050): 5G co-constructs and shares innovative business to develop rapidly

Investment Highlights: Event: China Unicom Releases 2019 Third Quarter Report.

The company achieved operating income of 2171 in the first three quarters.

2 ‰, 1 year down.

18%; net profit attributable to mother 43.

16 ppm, an increase of 24 in ten years.


Among them, in Q3 2019, it achieved revenue of 721.

67 ppm, a 10-year increase2.

21%; net profit attributable to mothers was 130,000 yuan, a year-on-year increase of 46.


4G traffic dividend subsided arpu was temporarily extended, and innovative business accelerated.

In the first three quarters of 2019, mobile main business revenue was 1,177.

330,000 yuan, at least -6.


Under the background of national regulatory policy adjustments such as speeding up and reducing fees, mobile billing users ARPU slipped to 40.

6 苏州夜网论坛 yuan (45 in 2018).

7 yuan).

However, the company continued to promote the Internet-based transformation of market operations, and the mobile user structure continued to improve.

In the first three quarters, there was a net increase of 9.69 million mobile billing users, reaching 3.

2.5 billion households.

Among them, 4G users had a net increase of 31.22 million, reaching 2.

5.1 billion households.

The penetration rate of 4G users to mobile billing users reached 77.

34% (H1 permeability 74%).

In addition, the company actively responded to the fierce competition with “big video, big integration, big bandwidth”, and the industrial internet business revenue in the first three quarters was 242.

91 trillion, +40 for ten years.


Benefiting from the rapid growth of innovative business, fixed-line main business 深圳桑拿网 income was 788.

63 ppm, ten years +7.


Revenue from main operations was 1,985.

320,000 yuan, at least -0.

7%, a decrease of -1 from the first half of this year.

1% percent.

As a leader in the mixed reform of state-owned enterprises, the company’s operating costs have been well controlled.

Benefiting from the good control of capital expenditures, the first three quarters of depreciation and amortization were temporarily -4.

5%; interest-bearing debt is significantly reduced compared to the same period last year, and financial costs are -486 per year.

0%; effective control of maintenance costs and electricity costs and network operation and support costs reduced -4.5%.

Cooperate with China Telecom to build a 5G network to efficiently achieve 5G coverage and enhance market competitiveness.

In the area of network construction, the two sides will construct 5G networks in 15 cities (with the total size of the 4G base stations (including room divisions) of the two sides as the main reference. Beijing, Tianjin, Zhengzhou, Qingdao, Shijiazhuang, 5 cities in the north, Unicom operating company and ChinaThe construction area ratio of telecommunications is 6: 4; Shanghai, Chongqing, Guangzhou, Shenzhen, Hangzhou, Nanjing, Suzhou, Changsha, Wuhan, and southern Chengdu 10 cities; the construction area ratio of China Unicom Operating Company and China Telecom is 4: 6).

China Unicom’s operating company will independently build 9 cities in Guangdong Province, 5 cities in Zhejiang Province, and 8 provinces in the north (Hebei, Henan, Heilongjiang, Jilin, Liaoning, Inner Mongolia, Shandong, Shanxi); China TelecomTen prefectures and cities in Guangdong Province, five prefectures and cities in Zhejiang Province, and 17 southern provinces outside the region will be independently constructed.

Co-construction and sharing can help reduce the cost of 5G network construction and operation and maintenance, efficiently achieve 5G network coverage, quickly form 5G service capabilities, enhance the market competitiveness of 5G networks and services, improve network efficiency and asset operation efficiency, and achieve mutual benefit and mutual benefitwin.

profit prediction.

China Unicom, as the leader of the mixed reform of central SOEs, has a clear performance growth assessment target for the fair incentive plan; it actively explores diversification of innovative business and asset-light operations. Business development has challenges and can be substituted.

What do we expect the company 2019?
2021 revenues will be 311.7 billion (+7).

2%), 337.9 billion (+8.

4%), 369.8 billion yuan (+9.

4%); net profit attributable to mothers is 60.

1.3 billion (+47.

3%), 83.

120,000 yuan (+38.

2%), 105.

3.8 billion (+26.


EPS are 0.

19 yuan, 0.

27 yuan, 0.

34 yuan; BPS is 4 respectively.

82 yuan, 5.

01 yuan, 5.

29 yuan.

With reference to the global mainstream telecom operators PB, the 2019 PB interval 1 is given.


7 times, corresponding to a reasonable value interval 7.

twenty three?

19 yuan, “continuous market” rating.

risk warning.

The uncertain impact of portability transfer, the short-term impact of 5G operators’ financial indicators such as accelerating investment and speeding up and reducing fees.