Introduction to this report:
By 2025/2027, Anhui Province's low-altitude economy will reach 60/ 80 billion yuan respectively, supporting infrastructure operation, flight service guarantee, standard system construction, etc., and providing corresponding subsidies and rewards. The location/qualification advantage of the General Design Institute is remarkable.
Incidents:
The Anhui Provincial Development and Reform Commission issued the “Implementation Plan for Accelerating the Cultivation and Development of the Low-Altitude Economy in Anhui Province (2024-2027) and Certain Measures” and the attached “Certain Measures on Accelerating the Cultivation and Development of the Low-altitude Economy”.
Commentary:
The plan indicates that by 2027, the scale of the low-altitude economy and innovation capacity of Anhui Province will reach the leading level in the country.
(1) Maintain an increase in holdings. Maintain the 2024-2026 EPS1.02/1.13/1.26 yuan increase of 17/12/ 11%.
Maintain the target price of 12.97 yuan, corresponding to 12.7 times PE in 2024. (2) The plan indicates that two core low-altitude economic cities, Hefei and Wuhu, will be built by 2027 to give full play to the supporting advantages of the low-altitude manufacturing industry in Lu'an, Chuzhou, Maanshan and other cities, highlight the characteristics of the low-altitude service industry in Anqing, Xuancheng and other cities, and basically form a low-altitude economic development pattern with dual-core linkage, multi-point support, and piecemeal development. (3) By 2025/2027, about 10/20 general airports and about 150/500 temporary take-off and landing sites and take-off points will be built, respectively, with a scale of 60 to 80 billion yuan. (4) By 2025, build 30 low-altitude benchmark application scenarios, 5 low-altitude economic development demonstration zones, and build 2 low-altitude economic development demonstration cities and 1 low-altitude comprehensive application urban agglomeration. By 2027, aim to create test sites (test areas) for civil unmanned aerial vehicles in several countries.
Support infrastructure operation, flight service guarantee, standard system construction, etc., and provide corresponding subsidies and rewards.
(1) For Class A general airports that have reached 1,000 flights per year (1 flight per take-off and landing), the provincial finance grants a subsidy of up to 1 million yuan to the operating company of the general airport. The subsidy period for each airport shall not exceed 3 years. (2) Accelerate the construction of low-altitude flight service guarantee system construction projects, and provide subsidies in accordance with no more than 20% of the approved contract amount. The operating loss portion is subsidized at a maximum of 6 million yuan per year, for 4 consecutive years. (3) Support the construction of a standard system in the field of low altitude. For enterprises leading the formulation of international and national standards, each standard will be given a one-time maximum reward of 1 million yuan and 500,000 yuan, respectively.
The company provides technical support to the government in the field of low-altitude economy. Civil aviation signed a new contract of 34 million yuan in 2023.
(1) The company is a technical support unit of the Provincial Low Altitude Office. Under the guidance of the Provincial Department of Transportation, the Civil Aviation Planning and Design Research Institute prepared the “Anhui General Aviation Industry Medium- and Long-Term Development Plan (2023-2035)” in early 2023, and proposed a “one circle, dual core, five zones and multiple parks” spatial layout planning system for the general aviation industry in Anhui Province to guide the development of the general aviation industry in the province. (2) The company continues to deeply cultivate the civil aviation business consulting service and survey and design market, and signed a new civil aviation contract amount of 34 million yuan in 2023.
Built a collaborative work platform based on AI and BIM, 2024PE is only 10 times larger. (1) It has industry-leading cloud computing capabilities to achieve full access to the cloud; has advanced industry knowledge base capabilities; and the survey and design collaborative business platform enables the overall quality and efficiency of the business. (2) Equity incentive assessment The compound growth rate of net profit due to mother for the period 2024 (based on 2020) is not less than 8.2%, after deducting non-ROE, not less than 13.74%.
Risk warning: Low-altitude economic policy risks. Low-altitude infrastructure investment progress falls short of expectations.