China Galaxy Securities Communication Industry Commentary: Aggregate procurement price limit hits new high, demand diversification trend evident.

China Galaxy Securities released a research report stating that the results of the bidding for the centralized procurement project of special optical cable products by China Mobile Limited from 2026 to 2027 have been announced. From the perspective of the winning bid prices, out of the 8 winning manufacturers, 7 of them bid according to the highest price limit. The products involved in this centralized procurement project are special optical cable products, including special ordinary fiber optic cable (including water-resistant cable, rodent-resistant cable, fire-resistant direct burial cable, all-dielectric cable, all-dielectric self-supporting cable), special ribbon fiber optic cable (including fire-resistant non-skeletal ribbon cable), air blown micro-cable, photonic composite cable, and figure eight self-supporting cable, totaling five types of products. The procurement of special optical cable products is approximately 79,400 fiber kilometers, equivalent to 3.13 million fiber cores. The project set a maximum bid price limit, with the highest bid price limit being a total of 251.2471 million yuan excluding taxes. From the perspective of the winning bid prices, except for the first place winner, the remaining 7 manufacturers bid according to the highest price limit, once again confirming the significant upward trend in fiber optic cable prices. Key points from China Galaxy Securities: - Event: China Mobile Limited's centralized procurement project for special optical cable products from 2026 to 2027 announced bid results, with 7 out of 8 winning manufacturers bidding according to the highest price limit. - Centralized procurement price limit at a new high, price increase driven by emerging demand. - Fundamental shift in demand in the fiber optics industry. The document also discusses risks related to production expansion falling short of expectations and risks related to changes in the international situation.