Report Highlights:

Overall Market and Communication Segment Market Review

Weekly Quotes: This week (2024.10.21-2024.10.25), the Shanghai Composite Index rose 1.17%, the Shenzhen Component Index rose 2.53%, and the ChiNext Index rose 2.00%. Shenwan Communications rose 3.03% this week. Considering the continued high prosperity of the communications industry, AI, 5.5G and satellite communications continue to promote the development of the industry, and we give the communication and electronics industry a "Recommended" rating.

Sub-industries: This week (2024.10.21-2024.10.25) among the three-level sub-industries of the communication sector, communication cables and supporting facilities rose the most, with an increase of 8.00%, and communication network equipment and devices rose the lowest, with an increase of 3.68%, and the sub-sectors mainly showed an upward trend this week.

In terms of individual stocks: In terms of sector analysis of gains this week (2024.10.21-2024.10.25), Taichenguang (70.89%), Hytera (61.17%), and Datang Telecom (38.79%) ranked among the top three.

Q3 Public Offering Positions: Active Equity Public Offering Quarterly Reduction in Communications, Optical Modules, Optical Fiber and Cable, and IDC are the main directions to increase holdings.

Zhao Zhiguo, Ministry of Industry and Information Technology: Support the Eastern Region to Take the Lead in Piloting and Exploring the Construction and Application of 5G-A On October 23, the State Council Information Office held a press conference today to introduce the development of industry and informatization in the first three quarters of 2024. At the press conference, Zhao Zhiguo, spokesman and chief engineer of the Ministry of Industry and Information Technology, said that China has built the world's largest and technologically advanced basic network. A total of 207 gigabit cities have been built, realizing "gigabit connectivity between counties and counties"; The proportion of 5G network access in administrative villages has exceeded 90%, comprehensively helping to strengthen agriculture and benefit farmers and rich farmers. The proportion of mobile IoT end users has reached 59.2%, and the pace of "superhuman things" continues to accelerate and expand.

The scale and level of computing infrastructure are among the highest in the world. At present, the total scale of computing power in China has reached 246 EFLOPS, and the 20ms delay guarantee capacity between national hubs has been fully realized, which effectively supports the allocation of computing power resources and the circulation of data elements. New technologies such as artificial intelligence, blockchain, and quantum information are booming, and nearly 200 generative AI service models have been filed and launched to provide services to the public, with more than 600 million registered users.

For the Ministry of Industry and Information Technology to promote the coordinated development of new information infrastructure, Zhao Zhiguo introduced four aspects: First, the overall planning of backbone network facilities. The second is to optimize the layout of computing infrastructure. The third is to deepen inter-regional coordination and inclusive development. Fourth, promote the integrated development of information facilities and traditional facilities.

Suggested focus direction: Computing power industry chain, satellite Internet

Recommended target:

Computing power: Zhongji Innolight (300308. SZ）； Xinyisheng (300502. SZ）； Yuanjie Technology Co., Ltd. ( 688498.SH ) ; Shanghai Electric Co., Ltd. (002463.SZ); FII (601138. SH）；

Satellite Communications: Hager Communications (002465. SZ）； Fujitec (835640.HK) BJ）； China Telecom (601728. SH）； Fudan Microelectronics(688385. SH）。

Risk Warning: The

risk of uncertainty in the international political environment and the risk that the market demand is less than expected.