国防军工本周观点：内需及自主可控-2025-04-06

Investment Rating - The industry rating is "Outperform the Market" [5][70]. Core Viewpoints - The report emphasizes the importance of domestic demand and self-sufficiency in the defense and military industry, highlighting the sector's resilience amid external pressures such as trade tensions [4][46]. - The military industry is expected to show strong recovery in 2025, driven by rigid demand and high domestic-driven proportions, making it a sector with significant investment potential [4][46]. - The report suggests focusing on traditional main battle equipment and high-elasticity sectors that will span the "15th Five-Year Plan" period [4][50]. Summary by Sections Industry Performance - The military industry index (801740) decreased by 1.96% from March 31 to April 3, while the CSI 300 index fell by 1.37%, resulting in an underperformance of 0.59 percentage points [19]. - Since May 2024, the military index has increased by 14.36%, outperforming the CSI 300 index, which rose by 7.13%, with a relative excess return of 7.23 percentage points [21]. Market Dynamics - Passive fund sizes and shares in military ETFs have significantly increased, indicating strong confidence in the sector [32][47]. - The military sector's current price-to-earnings ratio (TTM) is 60.8, placing it in the 76.47 percentile, suggesting high allocation value at this time [4][50]. Key Investment Opportunities - Recommended stocks include traditional main battle equipment manufacturers such as AVIC Shenyang Aircraft Corporation and AVIC Xi'an Aircraft Industry Group, as well as companies involved in commercial engines and materials [4][50]. - The report identifies potential high-growth areas such as low-cost drones and controlled nuclear fusion technologies [4][50]. Recent Developments - The report notes significant policy changes affecting the military sector, including new tariffs imposed by the U.S. and corresponding responses from China, which historically have led to increased performance in the defense sector during trade tensions [4][46]. - The military sector's strong performance during previous trade conflicts suggests a pattern of resilience and potential for future growth [4][46].