Key points of investment:

The company's performance continues to grow at a high rate. In the first three quarters of 2024, the company obtained revenue of 2.007 billion yuan, +43% year on year; net profit to mother 0.146 billion yuan, +41% year over year; net profit of 0.07 billion yuan after deduction, +25% year over year. Single Q3 earned revenue of 0.903 billion yuan, +33% YoY; net profit to mother 0.082 billion yuan, +21% YoY; net profit of 0.065 billion yuan after deduction, +45% YoY. The net operating activity flow changed in the third quarter: 2024Q1, Q2, and Q3. The company's net operating activity flows were -0.405 billion yuan, -0.112 billion yuan, and 0.16 billion yuan, respectively.

The “Digital Intelligence Low Altitude Brain” was launched to create a digital base for the low-altitude economy. In October 2024, the finals of the first 2024 Innovation Fair Low Altitude Economy Innovation and Entrepreneurship Competition with the theme of “Flying Low Altitude, Leading Innovation” came to an end, and the company won the second prize in this innovation and entrepreneurship competition. The company launched a digital intelligence low-altitude brain: providing basic geographical, urban three-dimensional, flight environment and other data supply and carrying capacity based on the digital Earth's spatio-temporal framework, constructing a low-altitude digital base to provide low-altitude data guarantee; providing computational services such as low-altitude digital modeling, airspace grid calculation, intelligent weather forecasting, electromagnetic global recognition, and ground surface information extraction based on an airspace grid computing engine and digital earth computing power to create a low-altitude intelligent calculation engine; the platform targets low-altitude traffic services, providing airspace planning, geographical fencing, flight posture, flight risk assessment and warning Equal common abilities, ultimately The low-altitude flight service guarantee provides strong support. We believe that the company has been deeply involved in the digital Earth for many years, has a deep understanding of airspace grids, three-dimensional cities, etc., and is expected to achieve greater development in the low-altitude economy era.

Accelerate the layout of the entire commercial aerospace industry chain. The company fully covers commercial aerospace-related application fields through its subsidiaries, and has five core capabilities to support the company's layout of the entire commercial aerospace industry chain. 1. Through the data capacity building of the top ten circles to build a digital Earth where fiction and reality coexist, the company has accumulated space information data capabilities; 2. Through the construction of Earth supercomputing and intelligent brain engines, powerful digital Earth intelligent computing capabilities have been built, and Zhongke Star Map has built the ability to calculate space information; 3. Based on the capabilities of multiple layers of the aerospace information industry chain, build a “sky information cloud”, build a more prosperous full-scenario developer ecosystem through platform+ecology, so that aerospace information capabilities can empower thousands of industries and reach the public, and the company has space information service capabilities; 4. Through technical foundation, customer acquisition base, and commercial base, it basically runs through the second growth curve business model; 5. Based on the big model of aerospace information to promote technological innovation and application prosperity, Zhongke Star Map strengthens space information innovation capabilities.

The company will continue to advance the “4+2" commercial aerospace industry chain construction plan over the next five years, including the construction of 1 electromagnetic satellite constellation, 1 meteorological satellite constellation, 1 remote sensing constellation, 1 new satellite constellation, 1 global measurement, operation and control network and operation service center and 1 sky information “star map cloud”.

Profit forecasting and investment advice. We believe that the company lays out the entire commercial aerospace industry chain, continues to strengthen its data business on the business model side, and is expected to improve its active service capabilities. Increased demand for spatio-temporal infrastructure and environmental weather protection in the low-altitude economy era is expected to open up new market space for the company. We forecast that the company's revenue for 2024-2026 will be 3.59/4.873/6.385 billion yuan, net profit to mother will be 0.488/0.679/0.913 billion yuan, and the corresponding EPS will be 0.90/1.25/1.68 yuan, respectively. Referring to comparable companies, combined with the current industry stage and company growth rate and barriers, the 2025 dynamic PE45-55 rate was given. The 6-month reasonable value range was 56.23-68.72 yuan, giving it a “superior to the market” rating.

Risk warning: Industry progress falls short of expectations, company market expansion falls short of expectations, industry policy risks.