Investment Rating - The report maintains an "Outperform" rating for the low-altitude economy industry as of May 25, 2025 [1]. Core Insights - The low-altitude economy sector has received significant attention from the national government, with policies aimed at fostering development and financial integration in technology sectors, particularly focusing on low-altitude economy projects [6][20]. - The industry has seen a decline in performance, with the Wande Low Altitude Economy Index dropping by 2.12%, underperforming compared to major indices such as the Shanghai Composite and CSI 300 [6][14]. - Key events include the World Drone Conference and UASE Drone Exhibition, showcasing advancements in low-altitude technologies and applications across various sectors [6][26]. Summary by Sections Market Review - From May 12 to May 25, 2025, the low-altitude economy sector underperformed the market, with significant declines in relevant indices compared to the Shanghai Composite and CSI 300 [6][14]. Policy Dynamics - The Ministry of Industry and Information Technology emphasized the importance of the low-altitude economy, announcing initiatives to deepen financial integration and support for high-quality project development [20]. - Local governments, such as Sichuan and Tianjin, have introduced policies to support low-altitude economic development, including funding for infrastructure and technology advancements [21][22]. Industry Dynamics - The Civil Aviation Administration of China reported a 15.4% year-on-year increase in drone flight hours, indicating growth in the sector [23][24]. - The establishment of the International Low Altitude Economy Cooperation Alliance aims to enhance global collaboration and resource integration within the low-altitude economy [38]. Investment Recommendations - The report suggests focusing on four main lines of investment: components, complete machines, infrastructure support, and air traffic management operations, highlighting specific companies within these categories [8].