Guotai Junan released a research report saying that the Ministry of Industry and Information Technology recently approved the test frequency of the new generation of railway mobile communication system (5G-R) based on 5G technology to China National Railway Group Co., Ltd., supporting it to carry out field technology tests of 5G-R system and continuously promote the high-quality development of railway communication industry. The bank believes that the time point and pace of the approval of the railway private network frequency band exceeds market expectations and is of great significance to the development of railway informatization. The time of the band approval is earlier than the consensus expectation of the market, marking the official upgrade of the railway network from 2G to 5G, while the annual stock process transformation demand, the value of equipment, the replacement frequency of equipment have been significantly improved compared with the previous 2G era. Recommended targets: ZTE (000063.SZ), Jiaxun Feihong (300213.SZ), China Pass (688009.SH), Thinking Column Control (603508.SH).

Guotai Junan pointed out that the 5G-R system mainly carries the core railway business of future railways, especially high-speed railways, such as train control, command and dispatch communications, and is a key infrastructure to ensure the safety and smoothness of railway traffic. Radio frequency is the only information carrier of railway wireless communication system, and it is an indispensable basic resource to ensure the safe operation of railway. The approval of the test frequency is conducive to accelerating the promotion and application of 5G-R system in the railway industry, and effectively solving many practical and technical difficulties faced by the current railway wireless communication system (GSM-R) based on 2G technology; it is conducive to clarifying the direction of the industry and strengthening Confidence, accelerate the formation of a complete and mature 5G-R industrial chain, and promote the high-quality development of my country's radio industry; it is conducive to further improving my country's railway informatization and intelligence, and share Chinese wisdom and contribute Chinese solutions for the development of high-speed railways in the world.