80 listed companies in Shenwan defense and military industry sector have released their 2021 annual report or performance express, with an average revenue increase of 19.5% and an average net profit attributable to the parent company increase of 14.3%. In terms of major segments, the average revenue of 34 aviation equipment companies increased by 14.8%, and the average net profit attributable to the parent company increased by 12.7%; The average revenue of 32 military electronics companies increased by 26.2%, and the average net profit attributable to the parent company increased by 17% Avic Heavy Machinery Co.Ltd(600765) , China Zhenhua (Group) Science & Technology Co.Ltd(000733) , Western Superconducting Technologies Co.Ltd(688122) and other achievements grew by more than 100%, and Guizhou Aviation Technical Development Co.Ltd(688239) , Wuxi Paike New Materials Technology Co.Ltd(605123) , North Industries Group Red Arrow Co.Ltd(000519) , Beijing Yuanliu Hongyuan Electronic Technology Co.Ltd(603267) , Chengdu Rml Technology Co.Ltd(301050) and other achievements grew by more than 50%.
According to the Chinese manned Changzheng Engineering Co.Ltd(603698) office, at 9:56 Beijing time on April 16, 2022, the return module of Shenzhou 13 manned spacecraft successfully landed at the Dongfeng landing site. The Shenzhou 13 manned spacecraft was launched from the Jiuquan Satellite Launch Center on October 16, 2021, and then docked with the Tianhe core module to form a combination. Three astronauts entered the core module for a six-month stay, setting a new record for the continuous on orbit flight time of Chinese astronauts. The complete success of Shenzhou 13 manned mission marks the successful completion of the mission in the key technology verification stage of the space station, and the Chinese space station is about to enter the construction stage.
According to the official wechat of the eastern theater, the spokesman of the eastern theater, senior colonel Shi Yi, said that on April 15, the eastern theater of the Chinese people’s Liberation Army dispatched destroyers, bombers, fighter planes and other forces to organize joint combat readiness police patrols of multiple services and arms in the East China sea and the sea and airspace around Taiwan Island, and carried out exercises on sea assault and other subjects. Boosted by this news, the ammunition and ship related targets in the military industry sector rose sharply on Friday, with Anhui Greatwall Military Industry Co.Ltd(601606) , Changshu Guorui Technology Co.Ltd(300600) , China Marine Information Electronics Company Limited(600764) leading the increase.
The boom expansion of the industrial chain is conducted in an orderly manner, and the value of sector stabilization and allocation is highlighted. Under the influence of market sentiment and other factors, the military industry sector experienced a sharp correction at the beginning of the year, and the logic of long-term boom expansion remained unchanged. The verification of advances received by downstream enterprises and the landing of large orders will be conducted in an orderly manner to the upstream and midstream along the industrial chain. During the “14th five year plan” period, the demand of supporting enterprises is highly deterministic. The CSI military industry index is valued at 52 times, which is at the 7% quantile value of historical PE. It continues to be optimistic about the value of sector allocation under the current position.
Grasp the main line of aviation equipment investment, and military electronics has high independent and controllable growth. 1) The contract liabilities of the main engine factory + the verification of the advance payment, and the growth of the aviation industry chain will continue to be realized. The performance transmission is effective. From the main engine plant and engine system, to the body system and parts, and then to the upstream raw material sector, the whole industry chain has strong momentum and certainty. The main engine manufacturer pays attention to Avic Shenyang Aircraft Company Limited(600760) , Avic Xi’An Aircraft Industry Group Company Ltd(000768) , Jiangxi Hongdu Aviation Industry Co.Ltd(600316) , Avicopter Plc(600038) , Aecc Aviation Power Co Ltd(600893) ; The body system pays attention to Avic Electromechanical Systems Co.Ltd(002013) , China Avionics Systems Co.Ltd(600372) , Aecc Aero-Engine Control Co.Ltd(000738) , Beijing Beimo High-Tech Frictional Material Co.Ltd(002985) ; Attention to aviation forgings and parts Avic Heavy Machinery Co.Ltd(600765) , Wuxi Paike New Materials Technology Co.Ltd(605123) , Guizhou Aviation Technical Development Co.Ltd(688239) , Xi’An Triangle Defense Co.Ltd(300775) , Chengdu Ald Aviation Manufacturing Corporation(300696) ; Attention to metal materials Fushun Special Steel Co.Ltd(600399) , Western Superconducting Technologies Co.Ltd(688122) , Baoji Titanium Industry Co.Ltd(600456) , Gaona Aero Material Co.Ltd(300034) , Jiangsu Toland Alloy Co.Ltd(300855) ; Composite materials focus on Avic Aviation High-Technology Co.Ltd(600862) , Weihai Guangwei Composites Co.Ltd(300699) , Sinofibers Technology Co.Ltd(300777) . 2) The certainty of missile weapons and equipment benefits from practical military training, and the independent and controllable military electronics in the field of high-end equipment brings high growth. Pay attention to Beijing Yuanliu Hongyuan Electronic Technology Co.Ltd(603267) , China Zhenhua (Group) Science & Technology Co.Ltd(000733) , Avic Jonhon Optronic Technology Co.Ltd(002179) , Guizhou Space Appliance Co.Ltd(002025) , Chengdu Rml Technology Co.Ltd(301050) , etc.
Risk tip: the epidemic repeatedly affects the macroeconomic environment; Equipment R & D progress and procurement progress are less than expected; Military procurement prices fell; Industry competition intensifies.
