ZTE(000063) 甬兴证券·2025-03-18 12:16Investment Rating - The report initiates coverage with a "Buy" rating for the company [3]. Core Views - The company is a global leader in integrated information and communication technology solutions, focusing on operator networks, government and enterprise business, and consumer business [15]. - The company's revenue for 2024 is projected at 121.299 billion yuan, a decrease of 2.38% year-on-year, with a net profit of 8.425 billion yuan, down 9.66% year-on-year [3][21]. - The core competitiveness of the connectivity business continues to improve, with an optimized market structure, particularly in the application of 5G-A technologies [3][28]. Summary by Sections Company Overview - The company provides end-to-end ICT solutions and serves over a quarter of the global population across more than 160 countries [15]. - The business is divided into three main segments: operator networks, government and enterprise, and consumer business [15][19]. Connectivity Side - The company is enhancing its access and transmission networks, with a focus on 50G PON and 5G-A technologies [48][52]. - The operator's backbone network is transitioning to 400G, with the first commercial deployment of a 400G all-optical inter-provincial backbone network announced by China Mobile [3][59]. Computing Power Side - The demand for computing power is driving growth in the server and switch markets, with the Chinese server market expected to reach 221.98 billion yuan by 2026 [2]. - The company is developing comprehensive intelligent computing solutions to support digital transformation across various industries [2][3]. Financial Forecast and Investment Recommendations - The company is expected to maintain steady growth, with projected net profits of 8.777 billion yuan, 9.491 billion yuan, and 10.394 billion yuan for 2025, 2026, and 2027, respectively [3][5]. - The earnings per share (EPS) for the same years are forecasted to be 1.83 yuan, 1.98 yuan, and 2.17 yuan, with corresponding price-to-earnings (PE) ratios of 20.20, 18.68, and 17.06 [3][5].