Investment Rating - The industry rating is "Recommended" [1] Core Viewpoints - The report highlights the significant investment plans of Ukraine in drone production, aiming to invest $22.5 billion by 2030 and produce approximately 18 million drones annually, with a focus on FPV drones [1][2] - The report emphasizes the growing importance of visual systems in modern drones, integrating high-resolution lenses, edge computing units, and AI algorithms for enhanced operational capabilities [2] - The report identifies infrared thermal imaging as a crucial technology for drones, enabling all-weather and all-terrain operations, thus expanding the application scope of drones in military and civilian markets [3][9] Summary by Sections Section 1: FPV Drones - FPV drones are highlighted as low-cost, high-mobility tools for modern warfare, capable of rapid acceleration and high-speed maneuvers, making them suitable for reconnaissance and attack missions [4][5] - The report notes that FPV drones can effectively evade detection and interception due to their speed and maneuverability, enhancing their survival rate on the battlefield [5][6] Section 2: Usage in Conflict - The report discusses the extensive use of small drones in the Russia-Ukraine conflict, with monthly usage rates reaching 60,000 to 70,000 units, showcasing their effectiveness in economic warfare [7] - It mentions specific examples of cost-effective drone operations, such as the Ukrainian use of a $600 drone to deplete Russian air defense systems [7] Section 3: Infrared Thermal Imaging Technology - Infrared thermal imaging technology is described as a transformative capability for drones, allowing them to operate in various environmental conditions and providing enhanced target detection and identification [11][12] - The report outlines the advantages of integrating infrared technology with drones, including non-contact detection and long-range monitoring capabilities [12] Section 4: Investment Recommendations - The report identifies key companies benefiting from the drone and infrared technology sectors, including: - Ruichuang Micro-Nano, which offers a full range of infrared products for drones [13] - Gaode Infrared, which has established partnerships with leading drone manufacturers [14] - Zhongrun Optical, known for its high-definition optical lenses for drones [15] - Lidin Optical, focusing on expanding its product offerings in the drone market [16]