Zhi DongXi (public number: zhidxcom)
Author | Cheng Qian
Edit | Li Shuiqing
Zhidong January 5 news, today, China communications giant China Mobile Co., Ltd. at an issue price of 57.58 yuan / share landed in A shares, since then, China's three major communications giants in A shares gathered.
On the first day of China Mobile's listing, the stock price opened high and went low, and the opening price reached 63 yuan / share, 9.41% higher. The highest share price per share on the first day was $63.58 and the lowest was $57.75. As of the close, China Mobile's first-day closing price was 57.88 yuan per share, an increase of 0.52%, and the latest market value reached 1.2 trillion yuan.
At present, China Telecom's A stock market value is 393.5 billion yuan, and China Unicom's A stock market value is 123.3 billion yuan.
▲ As of today's close, China Mobile's stock price has changed
According to the prospectus, on September 3, 1997, China Mobile was established, and on October 23 of the same year, it made an initial public offering of shares and listed on the Hong Kong Stock Exchange. On October 22, 1997, China Mobile publicly issued American Depositary Shares (ADRs) and listed on the New York Stock Exchange. In November 2020, the U.S. government ordered three Chinese telecom operators to delist. On May 18, 2021, the company was delisted from the New York Stock Exchange.
As of the end of June 2021, China Mobile had 946 million customers, 205 million home improvement broadband customers, 2.15 billion total connections, 5.28 million base stations, 500,000 5G base stations, and 251 million 5G package customers, all ranking first in the world.
▲China Mobile's global scale
In the 5G era, China Mobile has led 122 key 5G standard projects in international standard organizations such as 3GPP and ITU, and has submitted more than 7,000 standard proposals, ranking first in the global operators' contribution to international standards, and is the first time that Chinese enterprises have taken the lead in formulating a new generation of communication system requirements and network architecture standards. As of the end of June 2021, the number of 5G package customers of China Mobile reached 251 million, ranking first in the world.
China Mobile intends to raise 48.695 billion yuan this time, and its investment projects closely focus on "accelerating the construction of emerging infrastructure" and "accelerating digital development" proposed in the 14th Five-Year Plan for National Economic and Social Development of the People's Republic of China and the Outline of Long-term Goals for 2035.
▲The purpose of China Mobile's raised funds
First, revenue and net profit ranked first in China, and the gross profit margin was higher than the industry average
China Mobile is a leading global communication and information service enterprise, providing a full range of communication and information services for individuals, families, governments and enterprises, and emerging markets.
In 2018, 2019, 2020 and the first half of 2021, China Mobile's operating income was 736.819 billion yuan, 745.917 billion yuan, 768.070 billion yuan and 443.647 billion yuan, respectively. China Mobile's profitability is stable and maintains good growth.
From 2018 to the first half of 2021, China Mobile's net profit was 116.869 billion yuan, 106.475 billion yuan, 108.134 billion yuan and 59.186 billion yuan, respectively.
According to the prospectus, China Mobile's operating income and net profit rank first among domestic communications and information service enterprises.
▲China Mobile's revenue and net profit
During the reporting period, the gross profit achieved by China Mobile was 240.533 billion yuan, 233.109 billion yuan, 234.810 billion yuan and 130.509 billion yuan, and the gross profit margin was 32.64%, 31.25%, 30.57% and 29.42% respectively.
▲Comparison of gross profit margins of comparable companies
Second, it has become a major player in smart cities, with more than 15 million government and enterprise customers
Since its inception, China Mobile has been focusing on the field of information and communication, and its main products and services have been continuously enriched with the development of information and communication technology from 2G to 5G.
▲Evolution of China Mobile's main products
China Mobile's main business is to provide communication and information services, and other revenues are mainly the sale of mobile phones, ICT equipment and smart terminals. From 2018 to the first half of 2021, the company's main business income was 670.907 billion yuan, 674.392 billion yuan, 695.692 billion yuan and 393.215 billion yuan, respectively.
▲Comparison of China Mobile's main business and other business revenues
At present, the company's main business has formed a series of information services including mobile communications, wired broadband communication services, as well as IDC, cloud computing, Internet of Things, digital applications and content, covering individuals, families, governments and enterprises and emerging markets, involving more than 200 countries and regions around the world, with 946 million mobile customers, 205 million home customers, and 15.53 million government and enterprise customers.
▲The main business is revenue in different markets
The proportion of China Mobile's personal market revenue has decreased year by year, from 75.78% to 64.99% from 75.78% in the first half of 2018 to 2021, and the proportion of government and enterprise markets has become larger, from 12.12% to 18.58%, and China Mobile has become a major player in the field of smart cities.
In the personal market, China Mobile provides multi-form intelligent terminals and diversified combination packages in combination with user needs, and has created a series of special products such as "Hecaiyun", "Cloud Game" and "Cloud VR/Cloud AR".
▲China Mobile personal market service scenario
As of the end of June 2021, The number of China Mobile customers reached 946 million, the number of 5G package customers reached 251 million, ranking first in the world, and the scale of key application users exceeded 100 million, of which "Hecaiyun" provided safe, intelligent, convenient and unlimited cloud storage services for 116 million users.
For the home market, China Mobile continues to increase investment in the construction of home broadband infrastructure, extending smart home application scenarios to many fields such as home security, intelligent control, social communication, health and pension, education and office.
▲China Mobile home market service scenario
In terms of smart home services, the company actively promotes open cooperation and establishes the "China Mobile Smart Home Cooperation Alliance", uniting more than 400 partners and launching more than 1,200 products. As of the end of June 2021, China Mobile's home broadband customers reached 205 million, and its customized TV box "Mobaihe" customers reached 154 million. From January to June 2021, the value-added business income of smart home reached 10.094 billion yuan, an increase of 35.60% year-on-year.
In the government and enterprise market, China Mobile adheres to the "network + cloud + DICT (DT cloud and big data technology + IT information technology + CT communication technology)" integrated development, in terms of cloud services, China Mobile strengthens the "N+31 +X" mobile cloud resource layout and the "4+3 +X" IDC resource layout; in the 5G vertical industry, the company landed the first 5G + smart grid, the first unmanned mining truck, the first 5G remote surgery and the first 5G all-scenario smart port; in terms of DITT solutions, China Mobile has built 15 products such as cloud video, clairvoyance, mobile office, and campus, and provides DITT solutions for vehicle collaboration, industrial Internet, smart campus, smart medical care, smart city and other industries.
▲China Mobile government and enterprise market service scenario
As of the end of June 2021, the number of government and enterprise customers of China Mobile reached 15.53 million, an increase of 37.56% year-on-year. In 2020, the company's government and enterprise market revenue was 112.920 billion yuan, an increase of 25.78% year-on-year;D ICT revenue reached 43.5 billion yuan, an increase of 66.51% year-on-year. From January to June 2021, the market revenue of government and enterprises was 73.074 billion yuan, an increase of 32.37% year-on-year:D ICT revenue reached 33.398 billion yuan, an increase of 59.78% year-on-year.
In addition to the individual, family, government and enterprise markets, China Mobile is also focusing on emerging areas such as international business, digital content and mobile payment. First of all, in terms of international business, China Mobile's international/Hong Kong, Macao and Taiwan roaming services cover 264 directions and 43 5G opening directions; it has reached in-depth cooperation with 466 operators and cooperated with 27 leading partners in the telecommunications industry to carry out the "Hand in Hand Plan", covering more than 3 billion mobile users around the world.
Secondly, in terms of digital content, China Mobile launched a cloud game service of "cloud edge + distribution", and launched cloud VR/cloud AR services based on the integration of "virtual + reality". In the field of mobile payment, China Mobile launched the "Hebao Payment" third-party payment platform, and as of the end of June 2021, the number of registered users of the Hebao payment platform has reached 293 million, and the total number of supported banks is 185.
Third, in 2020, research and development accounted for 1.45%, laying out AI and cloud computing
The information and communication industry to which China Mobile belongs is a comprehensive field of fusion communications, electronic information, computers and many other disciplines.
In 2018, 2019, 2020 and the first half of 2021, the R&D investment was 3.865 billion yuan, 6.670 billion yuan, 11.099 billion yuan and 5.795 billion yuan, accounting for 0.52%, 0.89%, 1.45% and 1.31% of the operating income, respectively.
▲China Mobile R&D expenses
According to the prospectus, compared with comparable listed companies, China Mobile's R&D expense ratio is higher than the average level of industries such as China Unicom and China Telecom, and is consistent with industry trends. The communications company Huawei's R&D investment in 2021 is 141.893 billion yuan, and the cloud computing and artificial intelligence company Aliyun has also exceeded 100 billion yuan, compared with China Mobile's R&D investment is not high.
▲Comparison of R&D expenses of comparable companies
China Mobile integrates 5G with emerging information and communication technologies such as artificial intelligence, big data, cloud computing, edge computing, and the Internet of Things.
In the field of artificial intelligence, China Mobile officially released the operator's first self-developed artificial intelligence platform "Nine Days", integrating hundreds of self-developed and external artificial intelligence capabilities.
▲China Mobile's self-developed artificial intelligence platform "Nine Days" (picture source is Guangming Network)
In the field of Internet of Things, China Mobile has comprehensively upgraded the connectivity of China Mobile's IoT open platform OneNET and OneLink, the IoT connection management platform, with a connection scale of 724 million, becoming the world's largest IoT card connection platform; OneNET has a connection scale of 206 million, and the platform capability is in the first echelon of the industry.
▲China Mobile OneNET platform (Image source is OneNET official website)
In addition, in the field of cloud computing, China Mobile plans to build a national "N+31+X" mobile cloud resource pool, self-developed cloud computing products are applied on a large scale on the live network, with more than 300,000 nodes; in the field of big data, the big data platform established by China Mobile has an average daily access to more than 1,100 TB of data, and provides comprehensive and agile storage, data, and tool open capabilities; in the field of edge computing, it is committed to building a hierarchical edge computing system, launching edge cloud products, and creating edge computing service capabilities. The world's largest content distribution network was built, and the number of distribution websites increased to 93,000.
As of the end of June 2021, China Mobile has more than 18,000 full-time R&D personnel, and the number of full-time R&D personnel has quadrupled in the past five years.
China Mobile has a total of 9,139 major patents owned or used in China and 373 major patents that have been granted overseas, ranking first among global telecom operators.
In addition, China Mobile has also undertaken a number of national key core technology research projects, and there are 23 national projects that have been deployed or are being developed, including "Service-based 6G Core Network Key Technology Research" and "6G Overall Technology Research", and 22 self-research projects.
While promoting independent research and development, China Mobile has established cooperation with well-known universities, innovation laboratories and well-known enterprises in the industry, including Shanghai Jiao Tong University, Beijing University of Posts and Telecommunications, Pengcheng Laboratory, Tsinghua University, Konka Group Co., Ltd., iFLYTEK Co., Ltd., and Southeast University.
▲Cooperation between China Mobile and well-known domestic universities, innovation laboratories and well-known enterprises in the industry
Fourth, the supplier is relatively stable, and Ali, Tencent and China Telecom are customers
During the reporting period, the top five customers of China Mobile were Alibaba Group Holdings Limited, Tencent Holdings Limited, China Telecom Group Co., Ltd., China Construction Bank Co., Ltd., China United Network Communications Group Co., Ltd., and Agricultural Bank of China Co., Ltd., and their overall customer structure was relatively dispersed. The sales revenue of the top five customers accounted for a relatively low proportion of the main business income in the current period, 3.23%, 3.30%, 3.32% and 3.47% respectively.
▲China Mobile's top five customers
The relatively low proportion of China Mobile's single customer revenue is in line with the company's business characteristics and business model, and its customer structure is stable and its ability to resist risks is strong.
The procurement content of China Mobile's corresponding main business mainly includes network equipment and basic equipment and network operation, support and use costs, and the rest of the procurement content accounts for a relatively small proportion. During the reporting period, the top five suppliers of China Mobile were Huawei Technologies Co., Ltd., China Telecom Group Co., Ltd., China United Network Communications Group Co., Ltd., China Tower Co., Ltd., and ZTE Corporation, and their main suppliers were relatively stable.
▲China Mobile's top five suppliers
China Mobile's business development process will involve inter-network settlement and circuit and network element leasing, so among the top five customers and suppliers in the reporting period, There are situations in which China Telecom Group Co., Ltd. and China United Network Communications Group Co., Ltd. are both customers and suppliers.
Among the top five suppliers of China Mobile, the shareholding company of China Tower Company has a shareholding ratio of 27.93%.
Fifth, China Mobile BVI holds more than 70% of the shares, and there is only 1 shareholder of more than 5%.
China Mobile BVI is registered in the British Virgin Islands (BVI), which holds 73.73% of The shares of China Mobile and is the controlling shareholder. With the exception of China Mobile BVI, all other shareholders hold less than 5% of the shares.
China Mobile Group, through its wholly-owned subsidiary, China Mobile (Hong Kong) Group, holds 100% of the shares of China Mobile BVI and is the actual controller. China Mobile Group was established on July 22, 1999, and the State-owned Assets Supervision and Administration Commission of the State Council and the National Social Security Fund Council hold 90% and 10% of the company's shares respectively.
▲China Mobile shareholding structure chart
China Mobile has a total of 8 directors, including 4 executive directors, namely Yang Jie, Dong Xin, Wang Yuhang and Li Ronghua, and 4 independent non-executive directors, namely Zheng Muzhi, Zhou Wenyao, Yao Jianhua and Yang Qiang.
Born in July 1962, Yang Jie graduated from rennes Business School in France with a doctorate degree in business administration and is a professor-level senior engineer. Yang Jie has served in Shaanxi Provincial Post and Telecommunications Administration, Shanxi Telecom Company and China Telecom Group, and is currently the executive director and chairman of China Mobile, as well as the chairman of China Mobile Group and the director and chairman of China Mobile Communications.
▲Yang Jie, chairman of China Mobile (Picture source is Tianyan News)
There are 46 major holding subsidiaries of China Mobile, and 5 major shareholding companies, namely Shanghai Pudong Development Bank, China Tower, iFLYTEK, True Corporation, and AsiaInfo Technology.
Conclusion: Policy support + market demand to help the development of information and communication
The innovation and development of the information and communication industry has been continuously improved at the national strategic level, and the 2019 Central Economic Work Conference, the March 2020 Meeting of the Standing Committee of the Political Bureau of the Central Committee, and the 14th Five-Year Plan for National Economic and Social Development of the People's Republic of China and the Outline of Long-term Goals for 2035 have clearly proposed to accelerate 5G technology research and industrial development.
With the technical characteristics of ultra-large bandwidth, ultra-wide connection and ultra-low latency, 5G will meet the digital life needs of users in more diversified business formats and provide enterprises with more valuable market opportunities. Moreover, in the downstream industry, the market demand for high-traffic application scenarios such as short video and ultra-high-definition live VR/AR is increasing, which has spawned the development of digital industrialization and industrial digitalization.
However, the current 5G application is still in the early stage of development, the development of related industrial chains, technology research and development, etc. still need to be further matured, the future development is still facing technology updates, cost optimization, model landing and market promotion and other aspects of uncertainty, while 5G needs to be deeply integrated with various industries in standard formulation, equipment research and development, product application and other links, the integration progress also has certain uncertainties.