航天电子：空天安全无人化共强军，效率活力高质量展新颜

Investment Rating - The report assigns a "Buy" rating to the company, marking it as the first coverage [4] Core Views - The company is a leading player in the aerospace electronics sector, deeply integrated with national aerospace security and uniquely positioned to benefit from the industry's growth [2] - The company has a robust history of steady performance growth, covering the entire spectrum of aerospace-grade electronic components and leading the charge in the booming commercial aerospace sector [2] - The company is expanding into new unmanned systems, with potential high-growth opportunities in the conversion of R&D to mass production [2] - Under the strategic guidance of high-quality development for state-owned enterprises, the company is shedding inefficient assets, focusing on core competitiveness, and implementing equity incentives for its drone business, signaling strong internal governance improvements [2] Company Overview - The company is the only listed platform under the China Aerospace Times Electronics Technology Corporation (Aerospace Ninth Academy), with a comprehensive integration of assets completed in 2016 [5] - It holds a dominant position in aerospace electronics, covering four major sectors: telemetry and communication, inertial navigation, integrated circuits, and high-end electromechanical components [5] - The company has been increasing R&D investment and talent acquisition to strengthen its technological edge, with 2023 gross margins reaching a post-listing high [5] Aerospace Sector - The company is well-positioned to capitalize on the growing demand for low-orbit satellite constellations, with an estimated need for over 7,000 satellites in the next five years [6] - The commercial aerospace sector is expected to drive demand for rocket and satellite electronic components, with market sizes projected to reach 18.8 billion and 29 billion yuan by 2028, respectively [6] - The company benefits from its close ties with the Aerospace Ninth Academy, giving it a unique advantage in aerospace electronics supply [6] Unmanned Systems - The company is a major player in the military drone market, with a complete product portfolio and strong market competitiveness [7] - It has expanded into the air and naval markets, developing advanced systems like loyal wingmen and underwater unmanned vehicles [7] - The company's drone products are exported to over ten countries, with flexible pricing and high-profit margins in the military export market [7] Operational Efficiency - The company is actively shedding non-core and inefficient assets, focusing on its defense-related main business [8] - It has raised 4.1 billion yuan through a private placement to fund core projects in telemetry, inertial navigation, and unmanned systems [8] - Equity incentives have been implemented for subsidiaries involved in unmanned systems, aiming to boost innovation and operational efficiency [8] Financial Performance - Since the 2016 asset injection, the company has maintained steady revenue growth, with military products driving profitability [20] - Military products account for approximately 70% of revenue, with gross margins consistently between 20%-25%, reaching a historical high in 2023 [22] - R&D expenses have grown at a CAGR of 18.74% from 2016 to 2023, with a significant increase in the proportion of R&D personnel [23] Technological Leadership - The company is a pioneer in aerospace telemetry and satellite navigation technologies, with a comprehensive range of products in telemetry, communication, navigation, and sensors [24] - It has a strong presence in inertial navigation, with leading technologies and a significant market share in the sector [27] - The company's integrated circuit business, managed by subsidiary Times Microelectronics, has a complete industrial chain and abundant wafer processing resources [30] Market Opportunities - The global satellite internet market is projected to reach 560 billion USD by 2025, with low-orbit satellites being a key growth area [32] - The company is expected to benefit from the expansion of the aerospace launch market, with rocket electronic components accounting for 15%-30% of total costs [43] - The low-orbit satellite platform electronics market is estimated to exceed 29 billion yuan by 2028, driven by commercial aerospace demand [44] Strategic Positioning - The company is a core supplier in the aerospace industry, with a high level of integration with the overall planning and development of the Aerospace Ninth Academy [47] - It maintains a leading position in aerospace electronics, with products widely used in missiles, rockets, satellites, and deep-space probes [48] - The company's products are integral to the success of China's major aerospace projects, with approximately two-thirds of the electronic components in a Long March rocket supplied by the Aerospace Ninth Academy [48]