军工行业本周观点：挑战中充满机遇

Investment Rating - The report maintains an "Outperform" rating for the defense and military industry [3]. Core Viewpoints - The defense and military index experienced a decline of 0.66% this week, while the Shanghai and Shenzhen 300 index fell by 1.01%, resulting in a relative outperformance of 0.34 percentage points. The index has retraced to levels seen before the Zhuhai Airshow, indicating a return to fundamental-driven investment logic in the military sector. The report anticipates a gradual improvement in the industry's fundamentals starting from 2025 as demand stabilizes [1][2]. - The report highlights that the fourth quarter is expected to be a period of intensive delivery completion in the industry, which will likely transmit demand to the mid-to-upstream sectors. The strong demand recovery expected in 2024Q4-2025 supports a positive outlook for financing buy-ins and passive fund inflows into the military sector [1][2]. Summary by Sections 1. Weekly Market Review - The military index fell by 0.66% from December 9 to December 13, ranking 20th among 31 primary industries. Since May 2024, the military index has risen by 20.63%, outperforming the Shanghai and Shenzhen 300 index by 11.51 percentage points [6][17]. - Various sub-sectors showed mixed performance, with the commercial aerospace sector performing the best due to upcoming satellite launches, while the information technology sector also benefited from satellite-related stocks [22]. 2. Individual Stock Performance - Top-performing stocks included Zhonghaida (up 19.55%), Hezhong Shizhuang (up 12.84%), and Shanghai Hanyun (up 12.51%). Conversely, stocks like Rifa Precision Machinery and Tianli Composite saw significant declines [23][26]. 3. Funding and Valuation - The report notes a significant increase in financing buy-ins and balances, indicating renewed confidence in the military sector. The military sector's current price-to-earnings ratio (TTM) stands at 60.81, with a percentile rank of 78.74%, suggesting a high allocation value at this time [28][32][34].