Core Viewpoint - Jiangsu Zhongtian Technology Co., Ltd. announced a significant change in its controlling shareholder, with Xue Jiping transferring 65% of the shares of Zhongtian Technology Group to his son Xue Chi for a nominal price of 0 yuan, effective June 16, 2025. This transfer is part of a family asset arrangement and does not affect the company's controlling shareholder status [1][2]. Group 1: Shareholder Changes - Xue Jiping, the former actual controller, has transferred his 65% stake in Zhongtian Technology Group to Xue Chi, who will become the new actual controller [1][2]. - The transfer does not trigger any mandatory tender offer obligations and does not change the shareholding structure of the listed company, which remains controlled by Zhongtian Technology Group [2]. Group 2: Management Background - Xue Jiping founded Nantong Zhongnan Special Cable Factory in 1992 and has held various leadership roles, including Chairman and General Manager of Jiangsu Zhongtian Technology Co., Ltd. from 1999 to 2013 and Chairman until June 2025 [2]. - Xue Chi, the new actual controller, holds a Master's degree in Business Administration and has extensive experience in the company, having served in various managerial positions since 2005 [3]. Group 3: Recent Business Developments - On the same day, the company announced it has received multiple bidding notifications and contracts for various communication and power projects, including significant contracts with China Mobile and State Grid Corporation [3]. - The total value of these projects is approximately 3.617 billion yuan, representing 7.53% of the company's audited revenue for the fiscal year 2024 [3]. Group 4: Financial Performance - In the first quarter of 2025, the company reported revenues of 9.756 billion yuan and a net profit attributable to shareholders of 628 million yuan [4].

Investment Rating - The report maintains an "Overweight" rating for the communication industry and its sub-sectors, including communication operators [9]. Core Insights - China Mobile has initiated a centralized procurement project for ordinary optical cable products for 2025-2026, with a notable decrease in both procurement scale and price limits, indicating a downward trend in capital expenditure for traditional connections [2][3]. - The optical fiber and cable manufacturers are expected to seek new growth points in saturated markets, such as undersea cables and data center interconnect (DCI) [2][3]. - The report highlights the need to monitor the bidding progress of optical fiber and cable manufacturers and their breakthroughs in new directions [2][3]. Summary by Sections Market Overview - The communication index rose by 4.96% last week, outperforming the Shanghai Composite Index and Shenzhen Component Index, which increased by 1.92% and 2.29%, respectively [2][13]. - The procurement scale for China Mobile's current round is 0.99 billion core kilometers, down 30.98% from 2021 and 8.65% from 2023 [14]. Procurement Details - The maximum price limit for this round is set at 5.675 billion yuan, a decrease of 42.44% from 2021 and 25.57% from 2023 [14]. - The average procurement price is 57.42 yuan per core kilometer, down 16.6% from 2021 and 18.72% from 2023 [14]. Company Recommendations - The report recommends several companies for investment, including China Mobile, China Telecom, and China Unicom, with target prices and ratings indicating a bullish outlook [10]. - Specific companies highlighted for their potential include Zhongji Xuchuang, Xinyi Sheng, and Tianfu Communication, all rated as "Buy" [10]. Industry Trends - The report notes a significant shift in focus towards AI computing chains and core asset value reassessment within the communication industry [4]. - The demand for optical cables in data centers is projected to account for approximately 5% of global demand by 2025, increasing to over 11% by 2030 [18]. Competitive Landscape - The competitive environment among optical cable manufacturers is expected to intensify due to the reduced procurement scale and price limits, with a maximum share of 19.36% for winning bidders [15][18]. - Major players are expanding into international undersea communication projects, with companies like Hengtong Optic-Electric actively participating in global markets [19].