Investment Rating - The report assigns a "Buy" rating for the company, marking it as the first coverage [4]. Core Views - The company, Aviation Industry Chengfei (中航成飞), is a leading player in China's aviation defense equipment sector, having achieved significant milestones in military aircraft development [2][18]. - The company has demonstrated robust revenue growth, with a compound annual growth rate (CAGR) of 18.5% from 2021 to 2023, increasing revenue from 53.39 billion to 74.968 billion RMB [36][38]. - The report highlights the company's strategic initiatives in enhancing its research and development capabilities, aiming to foster technological innovation and improve operational efficiency [3][4]. Summary by Sections Company Overview - Aviation Industry Chengfei was established in 1958 and has become a key base for the development and production of aviation weapons and equipment in China [18][21]. - The company recently went public through a reverse merger with AVIC Electromechanical, with shares listed on January 22, 2025 [18][21]. Investment Logic - Chengfei leads the domestic military aircraft iteration wave, having developed China's first third-generation and fourth-generation fighters, including the J-10 and J-20 [2]. - The company has a strong export capability, with military aircraft exports valued at 11 billion TIV, accounting for 51.19% of domestic military aircraft exports [2]. Industry Position and Growth - The company is positioned to benefit from the increasing demand for military equipment driven by national defense initiatives [36]. - Chengfei's revenue and net profit have shown consistent growth, with net profit rising from 1.85 billion to 2.423 billion RMB from 2021 to 2023, reflecting a CAGR of 14.4% [36][38]. Financial Projections and Valuation - The report forecasts net profits of 1.27 billion, 3.989 billion, and 5.041 billion RMB for 2024, 2025, and 2026, respectively, with corresponding EPS of 0.21, 1.49, and 1.88 RMB [4]. - A target price of 89.41 RMB is set for 2025, based on a 60x PE ratio, reflecting the company's unique position in the aviation equipment sector [4].
中航成飞：歼击机龙头华丽上市，引领我国航空防务装备跨越发展-20250301