On January 24, the company announced that it plans to invest 510 million yuan to build the “Industrialization Project for Liquid Rocket Engine Thrust Chamber Materials, Parts and Components” and to invest 820 million yuan to build the “Sirui New Materials Technology Industrial Park Construction Project”.

Boarding the commercial space development express, the 5-year production capacity plan increased 11 times. Countries around the world have proposed large-scale satellite internet plans, and future rocket launches require a wide range of space. The company's thrust interior wall products are an important component in liquid rocket engines to complete propellant energy conversion and generate thrust. By the end of 2023, the company expects to achieve a manufacturing capacity of 100 sets of materials, parts and components, and plans to increase a total of 1,100 sets over the next 5 years. In terms of technology, the company has developed CuCNB materials and preparation technology for next-generation liquid rocket engine thrust interior walls and produced them in small batches. It has developed 3D printing processes, thermal isostatic pressing processes, and forging processes for CuCNB materials, which have reached the leading level in China. On the customer side, the company's downstream covers central enterprises and private enterprises. On the one hand, it serves major national aerospace projects. On the one hand, it continues to serve enterprises such as Blue Rocket Aerospace, Star Glory, Kyushu Cloud Arrow, Zhongke Aerospace, Tianbing Technology and other private space companies that are rapidly accumulating energy. Furthermore, the company is actively connecting with SpaceX to expand the application of the company's liquid rocket engine combustion chamber liners in leading companies in this field.

Project plans such as medical imaging equipment and optical module chip bases create multi-dimensional growth poles.

CT and DR ball tube components: The company's main products include metal tube shell components, rotor components, bearing sleeves, cathode parts, etc. Currently, only a few companies, such as GE, Siemens and Philips, have CT tube design, development and manufacturing capabilities, benefiting from the objective requirements of increased localization rate of high-end medical equipment and increased domestic demand. The business has broad development opportunities. The company built a production capacity of 6000-8,000 sets in the first half of 2023.

Optical module chip base: Optical module chips above 400G have greatly increased the heat dissipation requirements, and new materials with low expansion and higher thermal conductivity are needed to meet the requirements. Tungsten-copper alloys with different components can meet the requirements of 400G, 800G, and 1.6T optical modules, and optical modules larger than 1.6T require copper-diamond materials with better performance to meet the requirements. The company's copper-tungsten alloy materials have low expansion and high thermal conductivity, meet the material requirements for optical module chip bases, and have achieved small-batch supply. Annual production capacity construction of 2 million pieces is progressing smoothly. Major customers include Finisar, Tianfu Communications, Global Radio and Television, and Dongguan Xuntao.

Maintain an “overstock” investment rating. The company is expected to achieve net profit of 0.98/138/183 million yuan in 2023-2025, with corresponding price-earnings ratios of 62/44/33 times, respectively, maintaining the “increase in holdings” investment rating.

Risk warning: risk of stagnation or termination of new construction projects, risk of overcapacity, risk of technological upgrading and R&D, risk of cost increase, risk of market uncertainty, risk of industry risk, risk of exchange rate fluctuations, risk of macro-environment changes, etc.