Core ideas of this week
1) Xi Jinping the general secretary signed the order No. 1 of the Central Military Commission in 2022 and issued a training mobilization order to the whole army. According to Xinhua news agency, the general secretary of the CPC Central Committee, the state president and the chairman of the Central Military Commission signed the order No. 1 of the Central Military Commission in 2022 on Xi Jinping 4, issuing a training mobilization order to the whole army. The main purpose of this mobilization order is to deepen practical training and ensure that it is ready to fight at any time. The order requires the whole army at all levels to resolutely implement the decisions and instructions of the Party Central Committee and the Central Military Commission, accurately grasp the changes in the situation of national security and military struggle, pay close attention to the changes in science and technology, war and opponents, vigorously promote the coupling of war and training, vigorously promote systematic military training, vigorously promote scientific and technological military training, comprehensively promote the transformation and upgrading of military training, and train elite troops who can fight and be good at war. The commanders and fighters of the whole army should carry forward the fighting spirit of fearing neither hardship nor death, train assiduously, scientifically and safely, strengthen their command ability, improve their fighting skills, practice a hard fighting style, and greet the victory of the 20th CPC National Congress with high spiritual outlook and first-class military training results. This is the fifth consecutive year since 2018 that the military commander has personally issued a training mobilization order, which has set a clear direction to pay great attention to military training, sounded the clarion call of the times for military training and war preparation, and further pointed out the direction for military training and war preparation in the new year. At present, the state attaches great importance to military construction and emphasizes the continuous improvement of military combat literacy through practical training. In the process of building a strong army, the demand for the assembly and consumption of weapons and equipment is expected to effectively support the sustained high prosperity of the military industry.
2) in the new year, various theaters and services carried out practical exercises to comprehensively promote the transformation and upgrading of military training.
According to the PLA Daily and the Ministry of national defense, the order signed by Xi Jinping aroused strong repercussions among the officers and soldiers of the whole army. All units quickly set off an upsurge of military training in the new year. In the first week of the new year, a series of practical exercises were carried out by various services in various theater areas of our army:
① on January 4, a brigade of the air force aviation corps of the southern theater organized flight training under low meteorological conditions;
② on January 4, a brigade of the rocket army organized a fire assault drill at minus 20 degrees Celsius;
③ on January 4, a land aviation brigade of the 81st group army of the army organized airborne training for special combat personnel;
④ on January 4, officers and soldiers of a brigade of the 72nd group army of the army drove a wheeled assault vehicle for live firing training,
⑤ on January 5, several bombers of a naval aviation regiment organized bomb dropping and ultra-low altitude flight training;
⑥ on January 6, a landing ship brigade of the navy of the southern theater organized practical training;
⑦ recently, a frigate detachment of the Navy went to a sea area in the South China Sea for multi-type weapon firing training. At the beginning of the new year, all armed forces actively carried out combat drills, closely focusing on the "enemy" situation, focusing on key and difficult subjects such as cross day and night mobility, extreme environment operations and landing coordination, so as to temper the firepower strike capability and emergency combat capability of the troops in complex environments. It is expected that under the background of military training and war preparation in the 14th Five Year Plan period, the frequency of multi-dimensional exercises will increase significantly, and companies in all links of the industrial chain may continue to benefit.
Focus on aviation, aerospace, informatization and new materials:
1) aviation equipment: both the surrounding situation and the construction of Navy and air force have put forward new requirements for military aircraft. At present, there is a large room for improvement in the number and structure of Chinese military aircraft. It is expected that with the national defense budget inclined to weapons and equipment, especially the air force and Navy, it is expected to accelerate the change of military aircraft. The disclosure of large contract liabilities by many companies in the early stage may further improve the cash flow of the industrial chain and promote the production and delivery of products. We believe that aviation equipment will show a high boom during the 14th Five Year Plan period, driving the improvement of industrial chain performance. In addition, the reform of military pricing mechanism and the increase of equity incentive scheme will also promote the improvement of industry profit level. It is suggested to pay attention to: [ Avic Shenyang Aircraft Company Limited(600760) ], [ Avic Xi'An Aircraft Industry Group Company Ltd(000768) ], [ Jiangxi Hongdu Aviation Industry Co.Ltd(600316) ], [ Aecc Aviation Power Co Ltd(600893) ], [ Avic Electromechanical Systems Co.Ltd(002013) ], [ Hefei Jianghang Aircraft Equipment Co.Ltd(688586) ], [ Beijing Beimo High-Tech Frictional Material Co.Ltd(002985) ], [ Avic Jonhon Optronic Technology Co.Ltd(002179) ], [ Avic Heavy Machinery Co.Ltd(600765) ], [ Wuxi Paike New Materials Technology Co.Ltd(605123) ], [ Guizhou Aviation Technical Development Co.Ltd(688239) ], [ Chengdu Ald Aviation Manufacturing Corporation(300696) ], [ Jiangsu Maixinlin Aviation Science And Technology Corp(688685) ].
2) aerospace equipment: in terms of missile weapons and equipment, the main driving factors of the missile industry mainly come from: the first is the iteration period, the second is the increase in the demand for strategic reserves, and the third is driven by practical training. The missile sector may be the most flexible segment during the 14th Five Year Plan period, which will bring rapid performance thickening of relevant listed companies, pay attention to the overall opportunities of the missile sector, and give priority to the targets with high performance flexibility and high proportion of missile business. It is suggested to pay attention to: [ Guizhou Space Appliance Co.Ltd(002025) ] and [ Beijing Relpow Technology Co.Ltd(300593) ]. In terms of Satellite Internet, Beidou navigation: the year-on-year growth rate of Beidou satellite navigation industry chain began to increase in 2020, and it is expected to maintain a high growth rate in 2022 and 2023. In Beidou navigation industry chain, the demand for Beidou navigation chips and Beidou navigation terminals increased rapidly; Satellite internet field: China Spacesat Co.Ltd(600118) network group is expected to become the main force of China Spacesat Co.Ltd(600118) Internet. At present, although China Spacesat Co.Ltd(600118) Internet is still in the early stage of development, Satellite Internet will still become an important development direction of 6G mobile communication. It is suggested to pay attention to: [ Chengdu Corpro Technology Co.Ltd(300101) ] and [ Chengdu M&S Electronics Technology Co.Ltd(688311) ].
4) informatization sector: due to factors such as the localization process, military modernization, accelerated update of new models and so on, it has continued to surpass the industry growth since 2018, focusing on military semiconductors, upstream electronic components, radar and electronic countermeasures, communication, navigation and remote sensing. The performance of some companies has taken the lead in entering the high-speed growth stage and is expected to continue in 2022. It is suggested to pay attention to: [ China Zhenhua (Group) Science & Technology Co.Ltd(000733) ], [ Unigroup Guoxin Microelectronics Co.Ltd(002049) ], [ Chengdu Zhimingda Electronics Co.Ltd(688636) ].
5) new materials: it is suggested to focus on the direction of superalloys, titanium alloys and carbon fiber composites. The military new material technology has basically realized self-control and represents China's leading level, and the dual / multi flow system of model certification makes the suppliers limited, the competition pattern at the supply end is good, the demand end is due to the large volume of main battle models and supporting engines, the proportion of new material application is increasing, the outsourcing proportion of main engine manufacturers is increasing, domestic substitution and other factors, It is expected that the future growth of the industry is highly uncertain, and the scale effect will continue to appear after the demand increases, driving the continuous decline of unit cost. Therefore, the gross profit margin of the industry may still have room to improve and gradually realize to profit, and it is possible to urgently explore the civil market, with good long-term growth. It is suggested to pay attention to: [ Baoji Titanium Industry Co.Ltd(600456) ], [ Gaona Aero Material Co.Ltd(300034) ], [ Western Superconducting Technologies Co.Ltd(688122) ], [ Avic Aviation High-Technology Co.Ltd(600862) ].
Risk warning: the replacement of weapons and equipment is not as expected; The development of a new missile model was not as expected.
