China Mobile's optical cable centralized procurement has been implemented, YOFC has clearly benefited, and Nomura maintains its buy position (Nomura)
The Nomura report pointed out that China Mobile has announced the results of the 2026-27 optical cable bidding.
The Nomura report pointed out that China Mobile has announced the results of the 2026-27 optical cable bidding. As the industry leader, YOFC (YOFC, 6869.HK) is undoubtedly the main beneficiary of this tender. The report emphasized that although the current stock price has fallen back from the previous high (the closing price on the day of the report was HK$151.90), Nomura still gave a "buy" rating and provided a chart of changes in ratings and target prices over the past three years. This large-scale bidding indicates that the demand for optical fiber and cable industry has entered a new round of business cycle after experiencing the previous downturn. The market has already expected the benefits brought by centralized procurement, but the details of the bidding price and share will be the key to determining the company's future profit elasticity. One-sentence conclusion: China Mobile's large-scale centralized procurement is a clear signal of the recovery of industry demand. As the leader, YOFC Optical Fiber's logic of rising volume and price is expected to continue to be realized in 2026-27, and a correction is a good buying opportunity. Positive/negative: Positive for YOFC (6869.HK). The market has certain expectations for winning the bid for centralized procurement, but the specific price and share still bring the possibility of exceeding expectations. Catalysts: 1) The final winning bid price and share of China Mobile's optical cable centralized procurement; 2) YOFC's future quarterly performance to verify its profitability improvement; 3) Whether other operators (such as China Telecom and China Unicom) will follow up with large-scale centralized procurement.