Event

In order to introduce the preparations for the 11th China International Aerospace Expo, the Executive Committee of the Air Show held a press conference at 10:00 on September 7, 2016. Jia Ke, head of the Party and Mass work Department of the China Aerospace Science and Technology Group, said at the meeting that as far as carrier rockets are concerned, the current direction of China's aerospace development is long March 5, long March 6, long March 7, and long March 11, the type spectrum of a new generation of carrier rockets. In the future, China's aerospace will also aim at deeper space exploration, including Mars exploration and other missions, and will need larger rockets. At present, China Aerospace is already planning the long March 8 carrier rocket, and is also studying a new generation of heavy carrier rocket.

Analysis

Heavy rockets will open a new chapter in aerospace: according to news released on the website of the Chinese Academy of launch vehicle Technology on the 6th, in order to meet the needs of future missions, China will develop a heavy carrier rocket with an arrow diameter of 10 meters and a take-off quality of 3000 tons. Its structural size and take-off quality will break through the existing carrier rocket capability level. Long Lehao, academician of the Chinese Academy of launch vehicle Technology, said that heavy carrier rockets are of great significance to enhance China's space activities and speed up the development of space applications. It is understood that the heavy carrier rocket is a major space science and technology project that will soon be launched to meet the needs of China's future manned lunar landing and Mars exploration. At present, China is already planning the long March 8 carrier rocket, and is studying a new generation of heavy carrier rocket. Just last month, the long March 8 carrier rocket appeared in the implementation Guide to High-end equipment Innovation Project (2016-2020) issued by the Ministry of Industry and Information Technology, which was also the first time that the long March 8 had appeared in official documents.

Liquid rocket engine is gradually becoming a system: according to the idea of generalization, serialization, and combination, the sixth Institute of Aerospace Science and Technology Group has newly developed two types of engines, one is liquid oxygen kerosene engine and the other is liquid hydrogen liquid oxygen engine. These two types of engines are new non-toxic, non-polluting and environment-friendly engines, and they are also technologically advanced engines. On the basis of these two engines, China Aerospace has planned and constructed the type spectrum of a new generation of large carrier rockets that will enter space in the future, including large, medium and small series. Since last year, the new engine has been applied to a new generation of carrier rockets. Long March 6 and long March 11 successfully made their maiden flights one after another. In particular, long March 6 used liquid oxygen and kerosene engines to send 20 satellites into space for the first time, creating a new record for more than one satellite launch in China. The "long March 5" carrier rocket to be launched in November this year will use China's latest hydrogen and oxygen engine YF-77, and the improvement of engine performance will greatly improve the carrying capacity of our rocket and make it possible to build a space station in our country.

The growth of the sixth Academy is clear during the 13th five-year Plan period: the sixth Aerospace Institute, the controlling shareholder of aerospace power, monopolized the production and manufacture of liquid engines for rockets in China. This year, the number of aerospace launches in China will exceed 20 for the first time, which is "the densest launch year in history" and will directly benefit the efficiency of the sixth Aerospace Academy. During the 13th five-year Plan period, China's planned annual rocket launch will exceed 30, and the annual launch will reach 40 at the end of the 13th five-year Plan. At the same time, with the establishment of the project for the development of heavy liquid engines, we believe that the growth of the sixth Aerospace Institute during the 13th five-year Plan period is certain, and the market space is also clear.

Investment suggestion

In 2008, under the strong promotion of Lei Fanpei, chairman of the first Aerospace Science and Technology Group and former president of the sixth Academy, the Aerospace Science and Technology Group supported the sixth Academy, the "Aerospace liquid Power National team", to become bigger and stronger by integrating the aerospace liquid power assets of the first and eighth Academies to the sixth Academy. Eight years later, industrial integration has basically matured, and capital operation has become an integral part of the topic. We expect to achieve a breakthrough in aerospace engine asset securitization in the near future. Aerospace Power, as the only platform for aerospace engine asset integration, has a broad space. From a long-term point of view, the target of the 13th five-year Plan of the sixth Aerospace Academy is 34 billion yuan in annual income and 1.7 billion yuan in annual profits, and the market capitalization target after asset integration should be more than 50 billion yuan. We give Aerospace Power a "buy" rating, with a target price of 40 yuan in the next six months.