China Securities·2025-03-07 09:56Investment Rating - The report maintains a rating of "Outperform the Market" for the computer industry [5]. Core Viewpoints - The AI industry is on an upward trajectory, with significant capital expenditure from domestic manufacturers, particularly Alibaba, which is expected to exceed its total capital expenditure over the past decade in the next three years [1][16]. - The report highlights the acceleration of capital expenditure in the AI sector, benefiting software companies with data, customers, and scenarios, leading to potential increases in ARPU and project pricing [1][39]. - There is a growing demand for model privatization, which favors integrated machines, hyper-converged infrastructure, and B-end service outsourcing companies [1][39]. Summary by Sections Industry Investment Rating - The report maintains an "Outperform the Market" rating for the computer industry [5]. Market Performance - The computer (Shenwan) index rose by 3.17%, outperforming the CSI 300 index by 2.17 percentage points [2][10]. Investment Portfolio - Current recommendations include Kingsoft Office, Inspur Information, Leshi Information, Digital China, Newpoint Software, Yonyou Network, BoSi Software, and Deepin Technology [3][40]. - The previous portfolio achieved a return of +6.01%, outperforming the Shenwan computer index's +3.17% return by +2.83 percentage points [3][40]. Industry News - Alibaba's future capital expenditure is projected to surpass the total of the past ten years, with a quarterly capital expenditure of 31.78 billion yuan, reflecting an 80% quarter-on-quarter increase [16][19]. - The report notes that the AI industry is experiencing simultaneous iterations across technology, model, and application layers, with significant government involvement in AI applications [1][33]. - The introduction of new models like Grok 3 by xAI and advancements in attention mechanisms by DeepSeek and Kimi are highlighted as key developments in the AI landscape [28][42]. Recommendations - The report recommends software companies with data and customer bases, such as Kingdee International and Yonyou Network, as well as companies in vertical sectors like Kingsoft Office and Foxit Software [1][39]. - It also suggests focusing on companies involved in model privatization and those in finance, government, and energy sectors that require customized software solutions [1][39].