Core Viewpoint - The stock of AVIC Shenyang Aircraft Corporation (中航沈飞) has shown a mixed performance in recent trading sessions, with a notable increase in stock price and significant trading volume, indicating active market interest [1][2]. Stock Performance - Year-to-date, AVIC Shenyang's stock price has increased by 18.58%, with a 1.41% rise over the last five trading days, a 1.99% decline over the last 20 days, and a 10.97% increase over the last 60 days [2]. - As of September 18, the stock price reached 59.67 CNY per share, with a total market capitalization of 169.17 billion CNY [1]. Financial Performance - For the first half of 2025, AVIC Shenyang reported a revenue of 14.628 billion CNY, a year-on-year decrease of 32.35%, and a net profit attributable to shareholders of 1.136 billion CNY, down 29.78% year-on-year [2]. - Cumulative cash dividends since the company's A-share listing amount to 4.356 billion CNY, with 2.992 billion CNY distributed over the last three years [3]. Shareholder Structure - As of June 30, 2025, the number of shareholders decreased by 13.07% to 124,700, with an average of 22,032 shares held per shareholder, an increase of 15.18% [2]. - The top ten circulating shareholders include significant institutional investors, with Hong Kong Central Clearing Limited holding 35.176 million shares, an increase of 15.506 million shares from the previous period [3].

Investment Rating - The industry investment rating is "Recommended (Maintain)" [1] Core Insights - The military trade market is significantly influenced by geopolitical factors, with advanced weaponry impacting national military capabilities and political dynamics. The U.S. and its allies dominate global military trade exports, accounting for 64.10% and 78.06% of total exports in the periods 2015-2019 and 2020-2024, respectively [2][34] - The global military trade market is characterized by high concentration, with the top ten exporting countries accounting for 89.70% of total exports from 2015-2019 and 88.60% from 2020-2024. The U.S. and France are the top two exporters in the latter period, with a combined share of 52.60% [2][34] - China's military trade share is expected to increase in the long term, aligning with its manufacturing capabilities and international influence, despite currently holding only 3.9% of the global military trade market in 2024 [2][34] Summary by Sections Military Trade Overview - Military trade, or arms trade, is a unique sector closely tied to geopolitical and military strategies, reflecting national interests and political continuity [12] - The United Nations defines military trade as the transfer of military equipment between countries, which plays a crucial role in regulating international political relations [12] Global Military Trade Landscape - According to SIPRI, global military trade has experienced stable growth, with total trade increasing from 80.82 billion TIV in 1950 to 289.38 billion TIV in 2024, reflecting a compound annual growth rate of 1.72% [30] - The military trade market has undergone three significant fluctuations since 1950, with the most recent period (2002-present) showing a recovery in trade volumes due to increased global tensions and military spending [30] Major Military Exporting Countries - The top five military exporting countries from 2015-2019 were the U.S., Russia, France, China, and Germany, with the U.S. maintaining a dominant position [34] - The military trade export figures for the U.S. rose from 503.68 billion TIV in 2015-2019 to 609.49 billion TIV in 2020-2024, marking a 21.01% increase [35] China's Military Trade Situation - China's military trade has seen fluctuations, with exports decreasing from 88.62 billion TIV in 2015-2019 to 83.85 billion TIV in 2020-2024, a decline of 5.38% [35] - The report highlights that China's military trade is expected to grow due to increasing geopolitical conflicts and the country's enhanced military capabilities [2][34]

Investment Rating - The report maintains an "Outperform" rating for the military industry, indicating a positive outlook compared to the broader market [2]. Core Insights - The military industry is showing signs of a fundamental turning point, with the upstream military electronics sector being the first to benefit from the recovery [1][4]. - In the first half of 2025, the military industry saw a total revenue of CNY 254.55 billion, an increase of 9.3% year-on-year, while net profit attributable to shareholders decreased by 1.1% to CNY 15.53 billion [3][9]. - The overall gross margin for the military industry was 18.7%, up 0.6 percentage points from the previous year, while the net margin improved by 2.6 percentage points to 6.3% [13]. Summary by Relevant Sections Aerospace Equipment Sector - The aerospace equipment sector reported a revenue of CNY 108.09 billion, down 7.5% year-on-year, with a net profit of CNY 7.29 billion, a decline of 20.1% [17][18]. - The revenue drop was primarily due to significant declines in two major manufacturers, AVIC Shenyang Aircraft and Aero Engine Corporation of China, as they shifted focus to future orders [17]. Space Equipment Sector - The space equipment sector's revenue was CNY 9.22 billion, down 15.3% year-on-year, while net profit fell by 49.5% to CNY 356 million [23][24]. - The sector experienced a reduction in revenue decline compared to the previous year, indicating some stabilization [23]. Ground Armament Sector - The ground armament sector achieved a revenue of CNY 12.73 billion, a growth of 26.6% year-on-year, with a slight net profit decrease of 2.2% to CNY 444 million [25][26]. - Notable growth was seen in companies like North Navigation, which reported a revenue increase of 481.2% [25]. Marine Equipment Sector - The marine equipment sector generated CNY 55.75 billion in revenue, a 12.6% increase, with net profit soaring by 107.9% to CNY 3.74 billion [27][28]. - The growth was driven by leading shipbuilding companies benefiting from a high international ship market [28]. Military Electronics Sector - The military electronics sector reported a revenue of CNY 68.76 billion, a significant increase of 51.1% year-on-year, with a net profit of CNY 3.70 billion, up 2.2% [3][4]. - This sector was the first to benefit from the overall industry recovery, reflecting a strong demand for components [3]. Investment Recommendations - The report suggests focusing on specific sub-sectors for investment opportunities, including the aircraft and aero-engine supply chain, missile and unmanned combat systems, and military trade-related companies [4]. - Recommended ETFs include the Fortune CSI Military Leaders ETF and the Guotai CSI Military ETF [4].

Investment Rating - The report assigns an "Overweight" rating for the military industry [12][38]. Core Viewpoints - The intensification of great power competition is a long-term trend, leading to a favorable long-term outlook for the military industry. The defense strategies of the US and its allies are gradually shifting towards the Indo-Pacific region, which may escalate tensions around China. Increased defense spending is essential to ensure peace, and the military industry is expected to benefit from this trend. The goal of achieving a century of military development by 2027 is anticipated to accelerate during the 14th Five-Year Plan period [2][8]. Summary by Sections Market Review - The military sector has seen an increase, with the defense and military index rising by 2.14%, outperforming the broader market by 0.62 percentage points during the week of September 8-12. The Shanghai Composite Index rose by 1.52%, and the ChiNext Index increased by 2.10% [12][13]. - Among various military indices, the leading military stocks performed the best, with a rise of 2.29%, ranking first among ten indices [12][14]. Major News in the Military Industry - NATO announced the deployment of the "Eastern Sentinel" system to enhance defense posture, integrating military resources from Denmark, France, the UK, and Germany. Concurrently, Russia and Belarus commenced the "West-2025" joint strategic exercise, aimed at improving military coordination and operational capabilities [9][10][23][25]. - The report highlights significant domestic and international military news, including China's maritime patrols and military exercises, as well as developments in the Israeli military operations [23][24]. Investment Recommendations - Recommended stocks include: 1. Assembly: AVIC Shenyang Aircraft Company (中航沈飞), AVIC Xi'an Aircraft Industry Group (中航西飞) 2. Components: AVIC Optoelectronics (中航光电) 3. Subsystems: AVIC Onboard (中航机载), North Navigation (北方导航), Aerospace Nanhai (航天南湖) 4. Materials and Processing: Philihua (菲利华), Huayin Technology (华秦科技) [10][11].

Group 1 - The Shanghai Stock Exchange has announced the candidate list for the third Technology Innovation Advisory Committee, which includes 60 individuals, with a public notice period of 5 working days [1] - Notable candidates include chairpersons and executives from listed companies such as Yinjia Yao from Zhongwei Company, Ji Fan Gao from Trina Solar, Xiaolong He from China Resources Microelectronics, and Lianshan Zhang from Jiangsu Hengrui Medicine [1] - The list also features founders and CEOs from well-known technology companies, including Xingxing Wang from Yushu Technology, Bicheng Han from Qiangnao Technology, Zhihui Peng from Zhiyuan Robotics, and He Wang from Galaxy General Robotics [1] Group 2 - The complete candidate list includes various professionals from different sectors, such as environmental planning, medical innovation, and aerospace engineering [2] - Key individuals on the list include Wang Wei Dong from the PLA General Hospital, Yinjia Yao from Zhongwei Semiconductor Equipment, and Ji Fan Gao from Trina Solar [2][3] - The committee aims to enhance the technological innovation landscape in China by leveraging the expertise of these candidates [1]

Investment Rating - The report maintains a "Positive" outlook on the defense and military industry for the first half of 2025 [3]. Core Viewpoints - The defense industry is experiencing a recovery in overall performance, with revenue and profit showing positive year-on-year growth [2][5]. - The report emphasizes the importance of focusing on the next-generation equipment and the rapid development of unmanned and counter-unmanned weaponry starting in 2025 [4][5]. - The industry is expected to benefit from increased global military trade and a favorable domestic demand environment, leading to a sustained growth trajectory [6]. Summary by Sections 1. Overall Industry Conditions - The military industry shows a recovery in its economic climate, with revenue and profit increasing year-on-year [18]. - In the first half of 2025, the military industry achieved revenue of 304.9 billion yuan, reflecting an 11.39% increase year-on-year, while net profit attributable to shareholders rose by 5.03% to 20.9 billion yuan [23][27]. 2. Revenue and Profit - Revenue performance varies across different segments, with the aviation sector contributing the most to both revenue and net profit in the first half of 2025, accounting for 45% and 54% respectively [44][49]. - The maritime equipment sector showed significant growth, with a revenue increase of 132.0% year-on-year [50]. 3. Profitability Indicators - The overall profitability of the military industry has faced short-term pressure, with gross margin decreasing from 21.60% to 19.27% and net margin from 8.78% to 6.85% from the first half of 2021 to the first half of 2025 [28][31]. - The report indicates that profitability is expected to improve as product prices stabilize and economies of scale are realized [28]. 4. Operational Indicators - Operational indicators have shown stable growth, with inventory increasing by 13.43% year-on-year to 349.3 billion yuan, and contract liabilities rising by 21.48% to 224 billion yuan [32][36]. - The report highlights that the growth in operational metrics reflects a robust demand from downstream sectors, ensuring a positive outlook for future performance [32]. 5. Key Companies to Watch - The report identifies several key companies to focus on, including AVIC Shenyang Aircraft Corporation, AVIC Chengdu Aircraft Industry Group, and others in both high-end and new-type combat capabilities [4][5].

Core Insights - The A-share market saw a rebound in the military industry sector, particularly in the aerospace segment, with the Aerospace ETF (159227) rising by 0.73% as of 1:37 PM on September 10. Key stocks such as Hualichuangtong increased by over 4%, while AVIC Shenyang Aircraft Corporation and China Satellite rose by over 3% [1] - The Aerospace ETF (159227) is the largest aerospace and defense ETF in the market, having attracted a net inflow of 476 million yuan over the past nine trading days [1] - The importance of air power in modern warfare has led to a focus on aerospace equipment in military construction, with high technical barriers and significant value within the military industrial chain [1] - According to Tianfeng Securities, enhancing military security capabilities is a strategic requirement for national development in China. The next three years will focus on achieving the centenary goal of military construction, with a significant push towards becoming a world-class military by 2025 [1] - The Aerospace ETF tracks the Guozheng Aerospace Index, with a high concentration of 97.96% in the military industry, covering a full range of aerospace and defense sectors including fighter jets, transport aircraft, helicopters, and missiles [2]

国元证券研报指出，中航沈飞上半年实现营业收入146.28亿元，同比下降32.35%；实现归母净利润 11.36亿元，同比下降29.78%。业绩下滑符合预期，短期波动不改长期趋势。公司短期业绩受交付节奏 影响出现波动，但现金流改善、合同负债高增以及新机型布局进展，均为中长期稳健增长奠定基础。考 虑到公司在航空防务装备领域的独特优势及其在民机产业链中的深度参与，看好其长期发展潜力。综合 考虑订单储备充裕、先进制造体系升级、新质生产力逐步形成，维持"买入"评级。 ...

中航沈飞所属申万行业为：国防军工-航空装备Ⅱ-航空装备Ⅲ。所属概念板块包括：大飞机、中字头、 央企改革、军民融合、中特估等。 截至6月30日，中航沈飞股东户数12.47万，较上期减少13.07%；人均流通股22032股，较上期增加 15.18%。2025年1月-6月，中航沈飞实现营业收入146.28亿元，同比减少32.35%；归母净利润11.36亿 元，同比减少29.78%。 分红方面，中航沈飞A股上市后累计派现43.56亿元。近三年，累计派现29.92亿元。 机构持仓方面，截止2025年6月30日，中航沈飞十大流通股东中，香港中央结算有限公司位居第四大流 通股东，持股3517.56万股，相比上期增加1500.58万股。华夏上证50ETF（510050）位居第六大流通股 东，持股2163.83万股，为新进股东。富国中证军工龙头ETF（512710）位居第七大流通股东，持股 2116.24万股，相比上期增加704.50万股。华泰柏瑞沪深300ETF（510300）位居第九大流通股东，持股 1961.93万股，相比上期增加159.45万股。国泰中证军工ETF（512660）位居第十大流通股东，持股 1280.80 ...

Investment Rating - The report maintains a "Buy" rating for the company, indicating an expectation of stock price appreciation exceeding 15% relative to the benchmark index [5]. Core Views - The company's performance in the first half of 2025 showed a decline in revenue and net profit, with revenue at 14.628 billion yuan, down 32.35% year-on-year, and net profit at 1.136 billion yuan, down 29.78% year-on-year. This decline is attributed to a slowdown in the delivery schedule of certain defense equipment and a shift towards high-end models, which has lengthened production and delivery cycles. Despite the downturn, the overall performance aligns with market expectations, and the net profit margin remains stable at around 7.7% [1][2][3]. Summary by Sections Financial Performance - In the first half of 2025, the company achieved a gross margin of 12.25%, a slight decrease of 0.28 percentage points year-on-year, while the net profit margin improved compared to the previous year, reflecting effective cost control and expense optimization. The second quarter of 2025 saw a revenue of 8.79 billion yuan, down 27.5% year-on-year, with a net profit of 710 million yuan, down 21.8% year-on-year, but showing a recovery compared to the first quarter [2][3]. Strategic Developments - The company is intensifying its focus on new fighter jets and advanced materials. The J-35A stealth fighter was showcased at the Paris Air Show, indicating the company's leading position in next-generation fighter development. Additionally, the establishment of composite materials and titanium alloy production lines is progressing, laying the foundation for future mass deliveries of stealth fighters. The company also launched a high-cargo drone project, expanding into military-civilian integration [3][4]. Order and Contract Status - The company has seen a significant increase in contract liabilities, which rose to 7.532 billion yuan, up 113.47% from the beginning of the year, indicating a robust backlog of pre-received orders and ample future revenue recognition potential. Accounts receivable decreased by 6.1% to 18.64 billion yuan, showing improved collection efficiency, while inventory decreased by 15.3% to 11.515 billion yuan, reflecting effective inventory reduction efforts [4][5]. Market Position - As a key player in China's defense aviation sector, the company maintains a core position in the national defense system. The J-16 series has become a mainstay for the air force, with sustained high demand. The company is also a significant supplier for the C919 project and is involved in various commercial aircraft models, indicating long-term growth potential in the civil aviation market [5][6]. Profitability Forecast - The company is expected to achieve net profits of 3.787 billion yuan, 4.234 billion yuan, and 4.852 billion yuan for the years 2025, 2026, and 2027, respectively, with corresponding price-to-earnings ratios of 30.78, 27.53, and 24.03. The outlook is supported by a strong order reserve, advancements in manufacturing systems, and the gradual realization of new productive capacities [7][9].