“十四五”务期必成，收官战催生2025高景气

Investment Rating - The report maintains a "Recommended" investment rating for the defense and military industry [2]. Core Viewpoints - The industry is expected to experience high prosperity in 2025, driven by both accelerated delivery of traditional equipment and explosive growth in emerging fields such as commercial aerospace and low-altitude economy [4][16]. - The demand side is characterized by a dual drive of "accelerated delivery of traditional equipment and explosive growth in emerging fields," with significant military budget allocations expected for new combat capabilities [4][15]. - The report emphasizes the importance of high-quality and low-cost production as core directives for the future of the military industry, with expectations of increased efficiency and reduced costs over the long term [13][15]. Summary by Sections 1. Industry Outlook - The report highlights the necessity of completing the "14th Five-Year Plan" and achieving the centenary military goals, with a focus on high-quality development [11][16]. - The 2025 defense budget is set at 1.81 trillion yuan, reflecting a 7.2% increase from the previous year, with a significant portion allocated to new combat capabilities and military training [15][45]. 2. Market Performance - The defense and military index saw a weekly increase of 7.44%, outperforming other sectors [18][20]. - As of March 9, 2025, there are 166 listed companies in the military sector, accounting for 2.77% of the total A-share market capitalization [26]. 3. Investment Recommendations - The report suggests that the marginal improvement in orders justifies an increase in fund positions, with a focus on "heavy orders, light performance" as the earnings reports approach [5][41]. - The military sector's current valuation is approximately 62.9%, indicating significant room for growth compared to technology stocks [5][32]. 4. Industry Dynamics - The report notes that anti-corruption measures are expected to enhance supply chain transparency, which will lower transaction costs and improve resource allocation efficiency [7][13]. - The emphasis on integrating military and civilian resources is expected to drive technological advancements and enhance combat capabilities [14][15]. 5. Company Updates - The report mentions that around 68 military companies have engaged in stock buybacks since January 2024, totaling approximately 3.858 billion yuan, reflecting confidence in the industry [41].