国防军工行业2025年投资策略：三周期共振，优选ROE趋势向上的核心资产

Investment Rating - The report rates the defense and military industry as "Buy" for 2025, maintaining the previous rating of "Buy" [2]. Core Viewpoints - The report emphasizes the importance of the sector's beta, highlighting the increasing certainty of the product, capacity, and inventory cycles. It notes that the military sector has shown stable growth in ROE since 2019, positively impacting PB valuation [2][56]. - The report suggests that the military sector's ROE is expected to improve, with a focus on selecting core assets with upward trends in ROE. The market's attention to ROE trends and stability is anticipated to increase due to new policies and market conditions [2][56]. Summary by Sections 1. Emphasis on Sector Beta: Increasing Certainty of Three Cycles - The core of the military investment framework is to grasp the interplay of product, capacity, and inventory cycles. The report identifies the need to find high-prosperity tracks and quality leaders within these cycles [56][57]. - The product cycle is the driving force behind growth, influenced by the rhythm of core equipment development and production. The report indicates that geopolitical discussions are significant for long-term product cycle curves but have limited mid-term implications [56]. - The capacity cycle reflects demand and is crucial for understanding profit elasticity. The military sector's planned nature of demand and government procurement leads to a high degree of planning in capacity investments [56]. - The inventory cycle is a lagging reflection of the capacity cycle, representing the internal cash flow turnover before revenue realization [56]. 2. Confirmation of Bottom: PB-ROE Model Analysis - The report analyzes the military sector's elasticity for 2025 through the PB-ROE model, indicating a strong correlation between ROE trends and PB valuation. It highlights that many key stocks are currently at relative low points in terms of PB and ROE [2][56]. 3. Core Stock Selection: Focus on ROE Uptrend - The report advocates for selecting military core assets with upward trends in ROE, emphasizing the importance of stable growth in net profit margins and turnover rates. It suggests a focus on sectors such as military trade, aviation engines, and large aircraft maintenance [2][56]. 4. Stock Selection Strategy: Optimized PB-ROE Approach - The report outlines four investment strategies for the military sector in 2025, including emphasizing stable growth in ROE, identifying potential reversals in ROE cycles, focusing on macro narratives, and considering the potential of state-owned enterprise reforms [2][56].