【China International Capital Corporation - CZ12A Launch Result Quick Review】

Today, the CZ-12A had its maiden flight, with first-stage flight normal and one sub-stage recovery failure. The flight results align with our previous expectations (Fa-l-c-on9/St-a-r-s-h-ip, Ne-w-G-l-e-nn achieved recoveries for the 20th/5th/2nd time respectively).

In the views updated over the weekend, we suggested that there is no need to overly focus on the launch results of the CZ-12A. The breakthrough in China's reusable rocket technology is merely a matter of timing, whether it is by the end of this year or next year. Looking ahead to 2026, multiple reusable rockets for commercial use are set to have their maiden flights, and the national team’s CZ-10A/B/C heavy rockets will also have their maiden flights next year, with CZ-10B being a reusable rocket aimed at large satellite constellation networking.

Commercial space has become a new focal point in the technological competition among major powers, driven by the synergy of policies, technology, and capital, propelling domestic commercial space into a fast development lane. We believe that next year will be the first year of accelerated development for domestic commercial space, entering its early growth phase, with the initiation of the XW second-generation system and the networking of key constellations through bidding, which will significantly elevate the industry's ceiling.

The market may see some adjustments due to the substantial short-term gains and the launch results of CZ-12A. This does not change the trend of accelerated development in commercial space; after adjustments, the sector will surely return to an upward trajectory and reach new highs. We recommend actively positioning during dips and valuing the low-position chips of core leaders. Recommended focus: #Xinke Mobile, China Satellite, Aerospace Electronics, Guobo Electronics, Zhenlei Technology.