Investment Logic of Ceramic Matrix Composites (CMC) - CMC represents a revolutionary material for aerospace applications, addressing the bottlenecks in thrust-to-weight ratio and thermal efficiency of modern high-end equipment [2][5] - CMC can withstand temperatures up to 1650°C, significantly higher than traditional nickel-based superalloys, which have a temperature limit of around 1100°C [3][5] - The lightweight nature of CMC, with a density of only 1/3 to 1/4 that of high-temperature alloys, enhances engine thrust-to-weight ratios [4][5] - CMC exhibits superior creep and fatigue resistance in extreme environments, extending the lifespan of components [5] Market Space and Driving Factors - The global CMC market is projected to reach approximately $14.4 billion by 2024, with a compound annual growth rate (CAGR) exceeding 10% [8] - Key driving factors include military aircraft engine upgrades and the increasing demand for high-power gas turbines [6][7] - The military aviation sector is expected to generate an average market size of about 5.54 billion yuan annually for CMC structural components over the next decade [11] - The civil aviation sector, particularly the domestic market for commercial aircraft engines, is projected to reach approximately 9.13 billion yuan annually over the next 20 years [11] Industry Chain Analysis and Investment Selection - The CMC industry chain consists of upstream, midstream, and downstream segments, each with varying investment values and risks [9] - Upstream focuses on core raw materials like continuous silicon carbide (SiC) fibers, which are critical and have high technical barriers [10] - Midstream involves the design and manufacturing of structural components, requiring advanced processing capabilities [14][15] - Downstream applications are primarily with engine manufacturers, where market entry is more challenging [16] Investment Strategy Recommendations - Prioritize investments in upstream core material companies and selectively invest in midstream firms with unique processes and strong academic-industry collaboration [17] - Ideal investment targets should possess stable mass production technology for second and third-generation SiC fibers, with annual capacities ranging from hundreds of kilograms to tons [13] - Companies should demonstrate advanced engineering capabilities and have established relationships with major manufacturers [20][21] Key Selection Criteria for CMC Projects - Evaluate the technical team and their background, focusing on their academic and industry experience [17][22] - Assess the technological advancement and maturity of the product, ensuring it has moved from concept to production [18][20] - Investigate the engineering and industrialization capabilities, which are crucial for realizing value [19][20] - Verify downstream validation and customer relationships, which serve as a market entry pass [23][30] - Examine intellectual property and barriers to entry, ensuring a robust competitive advantage [24][30] - Analyze shareholder structure and capital planning to ensure long-term viability [25][30] Conclusion and Outlook - The CMC sector exhibits high growth potential, strong barriers to entry, and significant driving forces, aligning with national strategic needs and industrial development directions [27] - The current timing presents a golden opportunity for investment, particularly in projects with strong ties to state-owned enterprises and established manufacturers [28][30]