Market review: as of December 24, 2021, Shenwan defense industry fell 1.54% this week, 0.86 percentage points lower than Shanghai and Shenzhen 300 index, ranking 20th among Shenwan 31 industries; Shenwan’s defense and military industry fell 5.30% this month, losing 7.15 percentage points to the Shanghai and Shenzhen 300 index, ranking 29th among Shenwan’s 31 industries; Shenwan defense and military industry sector has risen 6.35% year to date, outperforming the Shanghai and Shenzhen 300 index by 11.91 percentage points and ranking 15th among Shenwan 31 industries.
As of December 24, 2021, the five sub sectors of Shenwan national defense industry had different performances. From the performance of the recent week, the ground military equipment plate increased the most, at 0.63%. Other sectors showed as follows: aerospace equipment sector fell 2.15%, aviation equipment sector fell 1.95%, navigation equipment sector fell 4.22%, and military electronics sector rose 0.26%.
View of the National Defense Industry Week: Recently, many companies have announced that they have received government subsidies. From the perspective of subsidies, the amount has increased to varying degrees compared with the previous two years, providing a better guarantee for the fundamentals of the industry. In addition, this year, the number of equity incentive enterprises in the military industry is increasing, and the coverage of equity incentive is becoming wider and wider. It is expected that more military enterprises will announce equity incentive schemes in the future, which will help the industry to improve in the long term.
In the long run, geopolitical events are becoming more and more complicated, and the number of global military exercises is becoming more and more frequent. Only by improving our military strength can we better deal with the increasingly complex world situation; The new variant virus has increased global uncertainty. As a key counter cyclical plate, the military industry plate is less affected by global economic events, and the industry as a whole is better and more certain. Optimistic about the high prosperity of the industry under the demand for equipment upgrading during the “14th five year plan” period, as well as the expectation of capital return under the acceleration of domestic substitution, optimistic about the aviation industry chain; On the other hand, we are optimistic about the development of Beidou industrial chain under the Internet of things and the development of special chips under the new round of digital currency reform. Suggestions on the subject: Aecc Aviation Power Co Ltd(600893) (600893), Avic Shenyang Aircraft Company Limited(600760) (600760), Unigroup Guoxin Microelectronics Co.Ltd(002049) (002049), Fushun Special Steel Co.Ltd(600399) (600399), Western Superconducting Technologies Co.Ltd(688122) (688122), Avic Electromechanical Systems Co.Ltd(002013) (002013), Avic Heavy Machinery Co.Ltd(600765) (600765), etc.
Risk warning: the number of new orders in the main engine plant is less than expected; Enterprise reform is not as expected; The epidemic worsened more than expected.
