Economic Growth at Low Altitude: Military Industry Stocks on the Rise in China

Our reporter Liu Yuru and Xu Yunqian reported from Beijing

The low level economy has recently returned! On April 24, stocks related to the CSI Military Industry Index led the rise, while stocks of the military information technology concept rose at the same time. , and China Direct Holdings (600038 .SH) and AVIC Shenyang Aircraft Co., Ltd (600760.SH) have also performed strongly in recent days.

This year, the low-level economy was included in the government’s work report for the first time, becoming one of the hotspots for the development of new productive forces. Wu Ximing, deputy director of the China Aviation Research Institute and deputy director of the Aviation Industry Science and Technology Committee, suggested that enterprises in the fields of aviation, aerospace, electronics, communications and other fields can be guided through the implementation of special projects . to use low-altitude industries, and further accelerate “technological innovation, industrial control, and safety assurance” at medium-sized state-owned enterprises.

Wang Peng, an associate researcher at the Beijing Academy of Social Sciences, said in an interview with a reporter from China Times that the economy is at a low level in the beginning stage, but major enterprises in the military industry have gone actively involved. As policies ease, the low-elevation economy is expected to improve rapidly. The technological advantages of medium military enterprises in the aerospace field will be transformed into advantages in the economic field at low altitude. Electronic communication plays a prominent role in the low-altitude economy, and technologies such as drones and remote sensing will boost the development of the low-altitude economy, with promising prospects.

Design in aerospace, electronic communication and other fields

With the deepening of national defense construction, the military industry is expected to bring forward more development opportunities.

Caihong Aerospace said in its annual report that the company’s current orders and delivery rates for its arms trade business are at historically high levels, and the company has good prospects for its arms trade business in 2024. Openness is and the favorable policies of the low-altitude economy supporting the better expansion of the company in the civilian market; Mentioned in the annual report, as a new productivity representative, the economy at low altitude has become an important guide in fostering new development momentum. With the country’s attention and continued policy support, the low-altitude economy will definitely become a new important economic growth area.

The annual report of Zhongzhi Co., Ltd. It is expected that the economy will introduce a period of strategic opportunities for rapid development.

According to Bai Wenxi, vice-chairman of the China Enterprise Capital Federation, the current low-level economic development in state-owned military enterprises is still in its infancy, but there is low-level economic development in some strong military areas, such as aircraft. , aerospace, electronics and other fields. Among them, state-registered enterprises in the military industry such as Aerospace Rainbow, Aviation Engine, and Zhongzhi Co., Ltd. have performed more prominently in a low-altitude economic area. These military industrial enterprises have made significant progress and have led to the development of a low-altitude economy due to their own technological and market advantages.

Bai Wenxi told a reporter from China Times that major listed enterprises in the military industry are actively using low-tech industries and taking advantage of the key opportunities mentioned in the government work report to promote the development and transformation of their own businesses. The continued activity of the low-altitude economy provides more investment opportunities and market demand to medium-sized military enterprises, while driving the development of related business chains, providing more opportunities for cooperation and possibility resource integration.

“This move will effectively promote the deep integration of the low-level economic innovation chain, industrial chain, talent chain, and capital chain, and will bring new impetus into the development of key military industrial enterprises scheduled in the future. ” Bai Wenxi said.

“As an emerging field, low-altitude economics fits perfectly with the concept of new productivity. It includes high production, new energy, new materials and other areas, and technological innovation runs through it.” Fu Yifu, a senior researcher at Xingtu Financial Research Institute, told China Times 》 The reporter said that the economy at a low altitude not only expanded the form of the economy, but also empowered traditional industries, improved quality and efficiency, and encouraged industrial innovation. At the same time, the low-lying economy adheres to advanced concepts such as innovative development and green development to bring new impetus to higher quality development in the national economy.

Medium-sized military enterprises face challenges

In recent years, the low-altitude economy has spawned a number of spending scenarios, and innovative application scenarios such as drone delivery and air transport have appeared one after another… content in government work reports to promote the development.

Recently, Hainan Province released the first regional drone test flight map; Guangzhou general aviation company received the world’s first unmanned aircraft system type certificate; Anhui Province has designed a prototype of a “one-hour travel cycle” for general aviation. It can be seen that with the continuous increase in policies and application conditions, the low-altitude economy has gradually begun to flourish and will bring revolutionary changes to urban transportation and logistics distribution in the future.

It is worth mentioning that although my country’s low-altitude economy is starting to develop, there are still certain challenges to break through bottlenecks and promote the healthy and orderly development of the low-altitude economy on to become the center of the business.

Bai Wenxi believes that with the economic growth at a low level, the central military enterprises are facing several challenges. In terms of technology research and development, it is necessary to deepen cooperation with universities and scientific research centers to accelerate technology transformation and demand; regarding the expansion of the market, it is necessary to strengthen cooperation with local governments and enterprises.

“At the same time, the integration of the upstream and downstream of the business chain cannot be ignored to strengthen overall competitiveness. To solve these problems, medium-sized military enterprises must integrate internal resources, strengthen external cooperation, and pay attention to talent training. The government and relevant departments should also increase support, provide policy and financial commitments, and together promote the sustainable and healthy development of the low-lying economy,” Bai Wenxi also said.

Wang Peng stressed that the low-altitude economy provides business opportunities for major enterprises in the military industry and also tests their social responsibilities. It is important to address challenges such as technology, funding and policies, strengthening research and technology development, seeking mixed finance and communicating with government departments.

Wang Peng also said that major enterprises in the military industry should deepen technological research and development and innovation in a low-altitude economic area, break through technology bottlenecks, and advance technology standards. To solve the financing problem, it is necessary to seek mixed finance, such as cooperation with private capital, issuing bonds, etc. At the same time, we actively communicate with government departments to strive for policy support and resource allocation to create a good environment for the low-altitude economy.

The research report at Soochow Securities indicated that it is optimistic about the military industry’s turnaround opportunities The situation and the surrounding environment are still tight usher in a continuous movement of renewed growth and renewal of valuation.

(Editor: Wen Jing)