The United States "Entity List" Re Expansion Of A Number Of Companies Said That There Are Already Related Plans.

"No thought." When the media asked Zhou Hongyi, chairman of the 360 group, whether he was prevented from being included in the entity list by the United States, he replied.

On the morning of May 23rd, Beijing, the US Ministry of Commerce and industry and Safety announced that 33 Chinese companies and institutions should be listed as "entity lists". Dongfang net, Huafu fashion, 360, beacon communications and other listed companies involved.

From the classification of "list" entities, it mainly includes AI and communication technology enterprises, well-known science and engineering universities and research institutions, domestic research institutes or enterprises that purchase foreign parts and equipment with the help of trade channel companies. The network security enterprise represented by 360 is the first to be included.

On the evening of May 24th, Dongfang Li and Hua Fu fashion announced that it would not have a substantive impact on the daily operation of the company.

However, from the response of the two tier market, in May 25th, the communications equipment sector led the market. Beacon Technology Group's listed companies, beacon communications, Changjiang communications, and optical technology declined by 9.85%, 3.83% and 4.7% respectively. Other companies were less affected, but Dongfang Power was on the same page. Huafu fashion rose 1.43%, 360 down 0.4%.

"The list of re issued entities in the United States has expanded the scope of sanctions from artificial intelligence and other cutting-edge technology research and application areas to network security. In general, the difficulty of acquiring technology in the country has increased. Especially for high-tech companies with equipment procurement needs, the impact is greater. In addition, prior to the US restrictions on HUAWEI policy, the upstream chip and other core parts supply may have an impact. In May 25th, a broker who studied the communications industry said.

Many companies say there are plans.

Dongfang net power is a dark horse that was found in this "entity list". After last Friday's trading limit, in May 25th, Dongfang opened its stock price again, and the price was over 3.29 million yuan, with a total market value of 3 billion 934 million yuan.

The announcement shows that Dongfang Power has been focused on the security video surveillance industry since its establishment. The company said that being included in the "entity list" will not have a substantive impact on the daily operation. At the same time, it has made relevant preparations in advance for possible market risks. It will continue to promote the replacement of domestic products in the procurement of hardware facilities, and continue to provide customers with quality products and services. At present, the production and operation of the company are normal.

However, it should be noted that the net revenue and net profit decreased by nearly 3 billion 200 million yuan last year, and also involved issues such as violation guarantee, capital occupation and bank account freeze.

Another company, Huafu fashion, is mainly engaged in the manufacture of high-grade new yarns. This is a wholly owned subsidiary of Akesu Huafu color spinning Co., Ltd., which is listed in the entity list by the US Department of Commerce.

Huafu fashion said that Akesu Huafu's raw materials, equipment and technology can circumvent products originating in the United States. Being included in the entity list will not have a substantive impact on the daily operation of the company.

In addition, as one of the "AI four dragons", cloud technology is also listed in this list. In May 25th, the cloud responded to reporters by science and technology, saying: "we regret the resolution and have prepared a plan for the corresponding situation." However, the company did not respond to specific measures.

Cloud smart robot operator Da technology also regrets the inclusion of the entity list, and calls on the US government to stop the unfair treatment of Tatsu technology as soon as possible. It says the company is operating normally.

Beacon technology group and its subsidiary Nanjing beacon Star Communications Development Co., Ltd. is listed in the list. In May 25th, beacon fire communications, Changjiang Telecom and light and fast technology of three listed companies of beacon technology group fell sharply in the two market.

"The relevant impact is still being evaluated. At present, only the parent company and its subsidiaries are listed, and the specific impact on the company is not clear. However, the procurement plan is already in progress, and the specific stocking cycle depends on the development of the event. "The investors think about the problems we have taken into consideration," he said to reporters calling the investor.

The network security enterprise represented by 360 is the first time to be included in the list.

The 360 group said frankly, "although being included in the entity list will cause certain problems to the development of the 360 business, it will not have a significant impact on the daily operation of the 360, and will not interrupt the ability of 360 to continue providing customers with security."

In May 25th and twenty-first Century, the business reporter also learned from a newly listed company that "in the past period of time, we have made comprehensive preparations, including strategic adjustment. First of all, exports will not be affected. Secondly, raw materials and equipment can be purchased through domestic and other countries to find alternative solutions. "

Domestic alternative road

Although most companies said that there were plans, they could not be avoided.

In October of 2019, the United States joined Hikvision, Dahua and HKUST to join the "entity list". Among them, Hikvision's net profit growth slowed last year.

In the 2019 annual report, Hikvision executives pointed out that Sino US trade frictions, the US National Defense Authorization Act came into effect, Hikvision was included in the entity list by the US Department of Commerce, while the domestic macroeconomic downturn, which led to insufficient industry demand and other factors, had a great impact on the company's performance in 2019.

And Hikvision's response can be seen as a common way of "domestic substitution".

"At present, the vast majority of us components can be directly replaced or replaced by new design alternatives, which will not affect the performance or impact of the products. A small amount of materials that are temporarily too late to replace are exchanged for longer replacement times by increasing inventories. There are also a small number of materials, through the adjustment of business strategy, purchased by customers themselves, combined use. In maintaining the core competitiveness of the company, the company's attitude is very firm: the chip is limited, chip replacement; no chips, for components; can not replace components, re design products. If necessary, design your own chip. " Hikvision said at the previous communication conference.

This is also the main logic for the 25 solar panel to rise. Photoresist is regarded as an important part of the integrated circuit industry.

But domestic replacement is still "long and slow".

Many industry insiders told reporters that with the recent US restrictions on HUAWEI to upgrade again, chip supply or the biggest difficulty. "Although there are chip alternatives, there is a big difference between performance and cost." In May 25th, another communications analyst admitted to reporters.

"At present, the impact on the company is temporarily unavailable. The most affected should be HUAWEI, HUAWEI's performance slowed down in the two quarter of last year. Moreover, the recent US restrictions on HUAWEI have been upgraded again, focusing on chip supply, not only HUAWEI, but also upstream and downstream businesses may be affected. The analyst said.

Data show that in 2019, HUAWEI realized net profit of 62 billion 700 million yuan, an increase of 5.6% over the same period, which is lower than the net profit growth rate of the past five years (14%). Xu Zhijun, chairman of HUAWEI's rotating chairman, bluntly said that HUAWEI's consumer business lost at least $10 billion in overseas markets last year due to US sanctions.

A research report by China Merchants Securities pointed out that the new regulations of the US export control on the one hand restrict HUAWEI and its affiliates from using the software design chip of the United States, and on the other hand, may restrict the supply of chips such as HUAWEI by overseas enterprises, such as TSMC. In the past, some American companies could bypass export control through overseas production and so on. Now this path has been blocked, and the transfer and localization of related product orders still need to be solved technically and cost. At the same time, this policy may have an indirect negative effect on some of the demand side of HUAWEI products.

While analyzing the impact of the entity list on beacon communication, Everbright Securities mentioned that the "entity list" or the main products of the company were mainly purchased from general motors, including the general server and the board, etc. the main source of the server included beacon fire supermicro. The incident is not clear whether it will affect the procurement of related components of optical communications. If we restrict the purchase of components such as optical chips / chips, or have a greater negative impact on the main business.

But there are other sides to coins. If we take a long look, the industry generally believe that the replacement of domestic semiconductor and other sectors of the long-term demand for good, the industry will lead to a larger division of growth space, and the upgrading of the list also shows that domestic TMT companies in the 5G, AI and other technology has been the world's leading.

?