[ET Net News Agency, 24 February 2020] Morgan Stanley cited Chinese domestic news
report noting that China Unicom (CU)(00763) plans to accelerate its 5G base station
rollout to build 250K 5G base stations, with China Telecom (CT)(00728), by the end of 3Q,
a quarter ahead of the original schedule.
By mid-2020, CU reportedly aims to add 100K 5G base stations. CU is said to already have
64K 5G base stations covering major cities as of 20 February 2020.
Morgan thinks acceleration would boost market sentiment for 5G infrastructure
beneficiaries. The research house's base case assumption is for the rollout to be heavily
skewed to 2H, and scale to be 500K-600K 5G base stations in total for the three operators
(China Mobile, China Unicom, and China Telecom).
It remains conservative on the smartphone supply chain based on recent demand
disruption, but whether operators will offer handset subsidies for faster 5G sub increases
is a key swing factor. Morgan added that whether the government will push for handset
subsidies remains the key to watch. (KL)