Investment advice
Core combination [core combination] of the core combination of the core combination of ‘ Avic Xi’An Aircraft Industry Group Company Ltd(000768) ;, China Cssc Holdings Limited(600150) , China Marine Information Electronics Company Limited(600764) , Beijing Aerospace Changfeng Co.Ltd(600855)
Key stock pool [Key stock pool] has focused on a pool of key shares in a pool of focused shares that has China Zhenhua (Group) Science & Technology Co.Ltd(000733) ;, Wuxi Hyatech Co.Ltd(688510) , Wuhan Guide Infrared Co.Ltd(002414) , Zhejiang Dali Technology Co.Ltd(002214) Xi’An Bright Laser Technologies Co.Ltd(688333) Chengdu Zhimingda Electronics Co.Ltd(688636) 688 Hongda Xingye Co.Ltd(002002) 985 Asian Star Anchor Chain Co.Ltd.Jiangsu(601890)
[last week’s report] [ Avic Jonhon Optronic Technology Co.Ltd(002179) ] depth: special connector faucet, dual drive for military and civil products; [ Avic Xi’An Aircraft Industry Group Company Ltd(000768) ] the credit line will increase by 167% in 2022; The company’s business scale is expected to expand rapidly
[views of this week] (1) the J-10 won export orders and the foreign trade market of China’s military products was opened. On March 11, the first batch of 6 J-10 CE fighters were delivered to Pakistan, marking the official loading of China’s new generation of aviation main combat equipment into the Pakistani air force, realizing the systematic and organic export of China’s new generation of aviation main combat equipment, which is another important milestone in the export of China’s aviation high-tech equipment. Previously, the UAE imported 12 + 36 L-15 Falcon advanced training aircraft from China. Exports are expected to open space for medium – and long-term growth. (2) The high outlook and medium and long-term investment logic of the military industry have not changed, and the investment value of this round of callback is prominent. Since the beginning of the year, Shenwan national defense military industry index has fallen by 21%. At present, the overall PE is 57 times, which is in the 23% quantile of the historical high, and the configuration value is prominent. (3) Endogenous and epitaxial dual drive: firmly optimistic about the military industry from 2022 to 2023, and the index has great room for rise; In 2022, as the last year of the “three-year action plan” of state-owned enterprises, the mixed reform / incentive / asset securitization will be promoted in an all-round way, the epitaxial growth will exceed expectations, and the military industry will be driven by endogenous + epitaxial growth.
[core view] the 12 character core logic of national defense and military industry: endogenous + extension, domestic demand + foreign trade, military products + civil products. The deterministic growth of national defense equipment is high. In 2022, it entered the “endogenous + extension” two wheel drive of “business cycle + asset integration”, “domestic demand + foreign trade” and “military products + civilian products”. The military industry index is expected to replicate the performance of the wind power index in the second half of 2021 in 2022, and the latter ranks first: (1) under the “century change”, the deterministic growth of national defense industry is high, “Preparing for war / 2027 / building a strong national defense commensurate with the second largest economy” is the established direction. Large contract liabilities in 2021 highlight the high boom of the 14th five year plan. (2) In the next few years, the securitization of national defense and military industrial assets and the reorganization and listing of core military products are expected to set off a new round of climax, and pay attention to the reorganization process of China Shipbuilding Group / Aerospace Hi-Tech Holding Group Co.Ltd(000901) / CETC / AVIC / Aerospace Science and industry / ordnance industry. (3) China’s tanks / UAVs / trainers / fighters are globally competitive, and the demand for foreign trade is gradually rising. Domestic large aircraft / civil aviation engine and other industrial chains are also gradually growing.
1. Main engine factory: the national defense and military industry is optimistic about the missile / informatization / Aviation Development / military machine sub industry, with scale effect + refined management and “small core and large cooperation”. The performance of national defense main engine is flexible in the next five years. With the conclusion of the “three-year action of state-owned enterprise reform”, equity incentive is expected to accelerate the release of performance: Avic Xi’An Aircraft Industry Group Company Ltd(000768) , Aecc Aviation Power Co Ltd(600893) , Jiangxi Hongdu Aviation Industry Co.Ltd(600316) , Avic Shenyang Aircraft Company Limited(600760) , Inner Mongolia First Machinery Group Corporation Co.Ltd(600967) Avicopter Plc(600038) , China Cssc Holdings Limited(600150) , AVIC.
2. Core parts / raw materials: 2. Core parts / core components / raw materials: keep your eye on high-tech barriers, high scarcity, and high-tech alloys / composites / high-profile high-competing high-tech barriers with a competitive landscape of high-tech barriers, high scarcity, and high-high-2. 2. Core parts / raw materials: 2. Core components / raw materials: 2. Core parts / raw materials: keep your eye on high-tech barriers, high scarcity, high-tech barriers, high scarcity, high-tech barriers, high-scarcity, high-tech high-tech barriers, high-scarcity, high-tech high-tech high-tech barriers, high-scarcity, high-priced competition, high-tech alloys / composites / midsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmidsmids, Wuxi Paike New Materials Technology Co.Ltd(605123) Guizhou Aviation Technical Development Co.Ltd(688239) Xi’An Triangle Defense Co.Ltd(300775) Wuxi Hyatech Co.Ltd(688510) Avic Electromechanical Systems Co.Ltd(002013) China Avionics Systems Co.Ltd(600372) Xi’An Bright Laser Technologies Co.Ltd(688333) Jiangsu Toland Alloy Co.Ltd(300855) 。
3. Military electronics: missiles and informatization: Unigroup Guoxin Microelectronics Co.Ltd(002049) , Fujian Torch Electron Technology Co.Ltd(603678) , China Zhenhua (Group) Science & Technology Co.Ltd(000733) , Chengdu Zhimingda Electronics Co.Ltd(688636) , Wuhan Guide Infrared Co.Ltd(002414) , etc.
Risk tips: 1) the rhythm of equity incentive and asset securitization is lower than expected; 2) the delivery progress of important products is lower than expected.
