Smart Money Pours Into HKATG – Parabolic Arc
HONG KONG (Hong Kong Aerospace Technology Group PR) – Hong Kong Aerospace Technology Group Limited (HKATG; 01725. HK) announced its strategic cooperation with the company and the Shandong Institute of Industrial Technology for the construction and operation of the first agricultural satellite high-resolution constellation (“Golden Bauhinia – Qilu Satellite Constellation”) on April 4. It is known that the first phase of the project comprising 9 satellites and the first experimental satellite is expected to be launched in July 2022, and the remaining eight operational satellites with 8-band multispectral observation capability will be launched in December 2022.
After the news broke, a huge amount of smart money was poured into HKATG, its stock soared for 4 consecutive days between April 4 and April 8. HKATG has posted a four-day winning streak since its last low of HK$12.2, in addition to breaking through the 10- and 20-day exponential moving average (EMA), the stock hit a new three-month high. during intraday trading on April 8. HKATG jumped more than 100% in a few days, and trading volume moved against the market which reached nearly 800,000 shares, with HKD 16.83 million committed capital and incredible momentum.
According to the Flow of Funds, several foreign and local banks have increased their holdings over the past few days, showing confidence in HKATG’s outlook. Previously, HKATG announced its collaboration with the College of Engineering of the City University of Hong Kong (“CityU”), the parties entered into a Letter of Intent (the “LOI”) regarding strategic cooperation in research and development of satellite technology and related applications in Hong Kong, covering communication systems, antenna technology, advanced materials, data processing and energy management. With the dominant position in the local commercial aerospace market, HKATG is well positioned for endless business opportunities.
Annual results do not fully reflect future profits
HKATG announced the consolidated annual results for the fiscal year ended December 31, 2021, although gross profit was down around 25.2% year-on-year, smart investors seem to be aware that the Last year’s results did not reflect several strategic deals the company signed since the start of 2022, so they bought immediately while the stock price retreated.
If you read the company’s annual report carefully, it is not difficult to analyze the reasons influencing the gross profit of HKATG in 2021. The key construction of the company, the control of the satellite operation and the application center at the AMC premises commissioned last year, which has resulted in increased operating costs while representing an important step in the expansion of production capacity. It is worth mentioning that, according to the latest annual results, the company’s net impairment losses on financial assets as of December 31, 2021 decreased significantly from RMB 5,122,000 in 2020 to RMB 131,000 in 2021, the result is quite encouraging.
A HK-exclusive aerospace manufacturer
According to HKATG management, the company will gradually put batches of optical remote sensing satellites into production, these satellites will have different types of payloads such as multispectral and synthetic aperture radars and can comprehensively provide remote sensing data and products. by satellite which integrate different bands. The company also announced earlier that these 25 satellites are scheduled to be launched in 2022 for the “Golden Bauhinia Constellation”, and the “Golden Bauhinia Satellite No. 1 (04)” is also ready for launch. With the launch of small satellites in batches, HKATG is expected to achieve in-orbit verification of miniaturized aerospace systems, laying the foundation for next year’s commercial constellation development.
“Golden Bauhinia Satellite No. 1 (04)” is another pilot satellite of the “Golden Bauhinia Constellation”, on the one hand, the satellite will carry out in-orbit testing and verification of micro-miniature remote sensing payloads, and d On the other hand, the data generated during the satellite’s in-orbit operation will be widely used in agricultural monitoring, disaster prevention and mitigation, as well as comprehensive urban management and watershed control.
Taking the supporting role in the development of Hong Kong into an international innovation and technology hub, HKATG certainly holds a dominant position in the market with explosive growth potential in the coming years and beyond.