Core Viewpoint - 中航光电's stock price has experienced a decline of 8.42% year-to-date, with significant drops over various trading periods, indicating potential challenges in the market [1][2]. Financial Performance - For the period from January to September 2025, 中航光电 reported revenue of 15.838 billion yuan, reflecting a year-on-year growth of 12.36%. However, the net profit attributable to shareholders decreased by 30.89% to 1.737 billion yuan [2]. - Cumulatively, 中航光电 has distributed 5.653 billion yuan in dividends since its A-share listing, with 3.863 billion yuan distributed over the past three years [3]. Stock Market Activity - As of November 24, 中航光电's stock was trading at 35.26 yuan per share, with a market capitalization of 74.690 billion yuan. The stock saw a trading volume of 3.77 billion yuan and a turnover rate of 0.52% [1]. - The stock has seen a net inflow of 26.3745 million yuan from main funds, with significant buying activity from large orders [1]. Shareholder Structure - As of November 20, 中航光电 had 113,900 shareholders, a decrease of 3.00% from the previous period. The average number of circulating shares per shareholder increased by 3.09% to 18,275 shares [2]. - The top ten circulating shareholders include notable funds such as 富国中证军工龙头ETF and 香港中央结算有限公司, with varying changes in their holdings [3].

Investment Rating - The report maintains a "Positive" investment rating for the defense and military industry [5] Core Viewpoints - The uncertainty in the Asia-Pacific situation is increasing, which may accelerate the equipment construction in China, focusing on new combat capabilities [2][12] - China's high-end aviation equipment showcased at the Dubai Airshow is expected to further expand the military trade market [12][15] - The Fujian aircraft carrier has conducted its first live training at sea, indicating a significant advancement in operational capabilities and technology [12][18] - The report emphasizes the importance of domestic demand for new combat capabilities and military trade as key growth areas [19] Summary by Sections Investment Suggestions and Targets - The report highlights various investment targets across different segments, including: - Engine and fuel chain: Companies like Xi'an Aero Engine (600893), Western Superconducting (688122), and others [19][20] - New quality and domains: Companies such as Aerospace Electronics (600879), Haige Communication (002465), and others [19][20] - Military electronics: Companies like Aerospace Electric (002025), Zhonghang Optical (002179), and others [19][20] - Military trade and main equipment: Companies such as AVIC Shenyang Aircraft (600760), AVIC Chengfei (302132), and others [19][20] Industry News and Market Performance - The report notes that the defense and military industry index has outperformed the broader market, with a decline of only -1.72% compared to the Shanghai Composite Index's -3.90% [22][25] - The report provides a detailed analysis of weekly market performance, indicating that the defense and military sector remains resilient amid broader market declines [22][25] Key Events and Developments - The report outlines significant recent events, including: - The U.S. government approved a new round of arms sales to Japan, which may heighten regional tensions and prompt China to expedite its military equipment development [12][9] - The successful live training of the Fujian aircraft carrier, showcasing advanced operational capabilities [12][18] - The participation of Chinese high-end military equipment in international exhibitions, enhancing China's presence in the global military trade market [12][15]

Core Viewpoint - The company, AVIC Optoelectronics, has confirmed its capability in providing high-reliability solutions for CPO interconnects through its optical module-related products, which are being delivered in an orderly manner based on customer needs [2] Group 1 - The company possesses technical capabilities in the CPO technology direction related to optical modules [2] - The company is actively delivering products that meet actual customer demands [2]

Core Viewpoint - The company has the technical capability to provide high-reliability solutions for CPO interconnection through its optical module-related products, and is currently delivering these solutions in an orderly manner based on customer needs [1] Group 1 - The company possesses CPO technology direction related to optical module products [1] - The company is actively delivering solutions that meet actual customer demands [1]

Summary of Liquid Cooling Connector Industry and Company Insights Industry Overview - **Industry**: Liquid Cooling Connector Industry - **Growth Drivers**: The rapid development of the liquid cooling connector industry is primarily driven by the limitations of traditional air cooling technologies in meeting the heat dissipation needs of data centers. The increasing demand for high-density data centers due to the growth of digital economy, 5G, and artificial intelligence is a significant factor [2][9][10]. Key Insights - **Market Size and Growth**: The liquid cooling connector market in China is projected to grow from 1.8 billion yuan in 2021 to 5 billion yuan in 2024, with a compound annual growth rate (CAGR) of 40.6%. By 2030, the market size is expected to reach 24.1 billion yuan, with a CAGR of approximately 30% [2][9]. - **Core Application**: Data centers are the primary application for liquid cooling connectors, expected to account for 60% of the market share. The demand for liquid cooling connectors will increase as the number of data center racks continues to grow [2][17]. - **Energy Efficiency**: Liquid cooling technologies can significantly reduce Power Usage Effectiveness (PUE) to below 1.3 for cold plate systems and even 1.2 for immersion cooling systems, enhancing energy efficiency and equipment stability [1][3]. Technological Developments - **Connector Types**: Liquid cooling connectors, known as Universal Quick Disconnect (UQD), are designed for quick connection and disconnection without tools. They are categorized into first-in and blind-mate types, suitable for different operational scenarios [4]. - **Technical Evolution**: The technology has evolved from the Beta version to version 4.0, with continuous improvements in functionality and application scenarios. The latest version includes features like pressure relief valves and non-stop pressurized connection capabilities [7]. Competitive Landscape - **Key Players**: Major competitors in the Chinese market are categorized into three tiers: - **Tier 1**: International companies like Stäubli and Parker, known for their high reliability and early market entry. - **Tier 2**: Domestic leaders such as AVIC Optoelectronics, Zhengbei Connection, and Yonggui Electric, which have strong production capabilities but are still catching up to international giants. - **Tier 3**: Companies like Industrial Fulian and Liminda, which have production capabilities but lack scale [12][13]. Policy Support - **Government Initiatives**: The Chinese government supports the liquid cooling technology and connector industry through various policies aimed at promoting energy-efficient cooling technologies and enhancing the development of data centers [8]. Company Spotlight: AVIC Optoelectronics - **Company Overview**: Established in 2002 and listed in 2007, AVIC Optoelectronics specializes in fluid connection technology and has developed over 500 series of products. The company has a strong patent portfolio and has been involved in setting industry standards [19]. - **Competitive Advantages**: AVIC Optoelectronics holds a significant position in the industry, having authored numerous national standards and developed a comprehensive range of liquid cooling solutions. Their revenue from related businesses grew from 840 million yuan in 2021 to 1.43 billion yuan in 2023 [20][21]. Conclusion - The liquid cooling connector industry is poised for significant growth driven by technological advancements and increasing demand from data centers. Companies like AVIC Optoelectronics are well-positioned to capitalize on this trend, supported by favorable government policies and a strong competitive edge in product development and market presence.

Core Viewpoint - The defense and military industry is expected to experience another upward trend due to multiple influencing factors, including geopolitical risks, technological advancements, and policy support [1]. Group 1: Market Performance - The military sector has continued its strong performance, with notable stocks such as Aerospace Development (000547) and Great Wall Military (601606) showing significant gains, including a net inflow of 1.828 billion yuan [1]. - The average stock price increase for military concept stocks this year is 30.94%, with North China Long Dragon leading with a 342.24% increase [2]. - Six military concept stocks have received institutional research attention in November, indicating strong interest from investors [2]. Group 2: Company Performance - Major companies in the military sector, including China Shipbuilding (600150) and AVIC Chengfei (302132), reported net profits exceeding 1 billion yuan in the first three quarters [3]. - Several companies, such as Zhenray Technology and North China Long Dragon, have turned losses into profits, with some achieving over 100% year-on-year profit growth [3]. - Institutions predict that nine military stocks will see significant profit increases by 2025, with expected growth rates exceeding 100% [3]. Group 3: Future Outlook - The military industry is poised to benefit from rising geopolitical risks, modernization goals, and expanding military trade markets, with high-end weapon exports expected to increase [1]. - Technological innovations, such as 3D printing and recyclable rockets, are anticipated to drive growth in the sector [1].

Core Viewpoint - The company is actively addressing the fluctuations in the prices of bulk raw materials by incorporating it into a specialized cost control initiative and optimizing both research and development processes as well as manufacturing techniques to enhance efficiency and effectiveness [1] Group 1 - The company emphasizes the importance of monitoring raw material price volatility [1] - A specialized cost control initiative has been implemented to manage these fluctuations [1] - Optimization efforts are being made in both R&D and manufacturing to improve usage efficiency and overall effectiveness [1]

Core Viewpoint - The company, AVIC Optoelectronics (002179), has confirmed its capability to provide high-reliability solutions for CPO (Chip-on-Board) interconnects through its optical devices and components, along with core technologies [1]. Group 1 - The company possesses optical devices and components that are compatible with CPO interconnects [1]. - The company emphasizes its core technologies that support the provision of reliable solutions for CPO interconnects [1].

Group 1 - The company, AVIC Optoelectronics (002179), reported that as of November 10, the number of its shareholders reached 117,368 [1]

Core Viewpoint - The company provides optoelectronic liquid interconnection solutions for the new generation of information technology and data center fields [1] Group 1: Brain-Computer Interface - The company offers lightweight and quick ICP series plastic plug-and-play connectors and components for connecting collected brainwave signals to peripheral devices [1] Group 2: Medical Robotics - The company provides integrated mixed transmission of network signals, control signals, and power signals through the MG series connectors and components, facilitating stable and efficient operation of medical robots [1]