From "Firefighting Vanguard" to "Scale Supply": Three Signals from Longyi Aviation's (00918) RMB131.5 Million Framework Agreement

The low-altitude economy fears two things most: first, talking only about scenarios without seeing orders; second, seeing only prototypes without seeing production scheduling. A single announcement by MAJESTIC DRAGON (00918) on the evening of November 9 happened to land right on these two pain points. Longyi Aviation has newly entered into a sales framework agreement with Shanghai Dexinyi Aviation Technology to supply 15, 18, 20, and 22-inch multi-spec FPV drone systems over the next two years, with an estimated total volume of 20,000 units and a total framework value of approximately RMB131.5 million. Based on the average price, each unit is about RMB6,575 this is not the high-ticket-price logic of heavy-load firefighting complete machines, but a new narrative of industrial-grade standardized products going for volume marking that the company's drone business has officially moved from a customized project model into a new stage of standardized mass production. For a long time, Longyi Aviation's drone business has centered on government-enterprise customized projects, focusing on niche tracks such as high-altitude firefighting, emergency rescue, and industrial surveying. Its technical barriers are solid and product reliability outstanding, but limited by the characteristics of customized production, it has faced industry pain points of dispersed orders, long delivery cycles, and large revenue volatility, making it difficult to unleash economies-of-scale profitability. The significance of this framework agreement lies not in the amount itself, but in the fact that the product has been abstracted into a reusable SKU: multi-size coverage, flexible supply over two years, and bulk procurement. It means Longyi is upgrading drones from "accessories to customized solutions" to "industrial hardware that can be scheduled for production, stocked, and repurchased." For the manufacturing side, framework volume brings visible production planning, diluted supply-chain costs, and improved yield; for the commercial side, it means moving from "waiting for tenders" to "entering channels." This is the sign that a low-altitude economy company has truly crossed the commercialization threshold. The emergence of Shanghai Dexinyi as the buyer is worth pondering for its underlying significance. Although this framework agreement is not a final procurement commitment, the buyer's willingness to lock in an estimated volume of 20,000 units over two years shows that a stable demand pool has already emerged downstream possibly industry integration, operation and maintenance training, security inspection, cultural tourism racing, or regional low-altitude operation platforms. For Longyi, this is a "0 to 1" credit endorsement: first get one framework customer running, and afterward the same template can be replicated to firefighting integrators, low-altitude service providers, local state-owned capital platforms, and even overseas channels. Combined with the company's earlier moves to set up training centers and manufacturing bases in Jining and Tonghua, Longyi's position in the industrial chain is being reshaped firefighting is the spearhead, but standardized product shipments are the foundation. From an industry perspective, this cooperation has strong market demonstration and replication value. At a time when blue-ocean tracks such as domestic low-altitude consumption, drone racing, youth aviation training, and cross-border civilian trade are growing rapidly, this benchmark cooperation will form a good brand endorsement, help the company quickly develop more channel-based and trading-oriented customers, and drive continued volume growth in the standardized drone business which is also expected to drive a re-rating of the company's capital market valuation. Analyzing performance, for fiscal year 2026 (ending March 2026), the company's total revenue is approximately HK$104.5 million, of which its Avic (Chengdu) Uas business is HK$34.1 million, up 27% year on year, with a segment gross margin of about 52%. If the RMB131.5 million is recognized over two years, that is about RMB65.75 million annually (equivalent to roughly HK$70 million), close to twice the existing annual revenue of the drone business. Even if only 30% to 50% is recognized according to delivery pace, it can still significantly amplify next year's drone segment revenue and gross profit. But it must be emphasized: a framework agreement recognized revenue, and there is the possibility of delays in batch procurement, downward average prices, and pressure on gross margin. In the short term, it benefits "revenue visibility"; only in the medium term should we look at the "profit inflection point." As the low-altitude economy enters the second half of 2026, the logic is switching: in the policy dividend period, watch "who can fly"; in the commercialization implementation period, watch "who can deliver." Therefore, the value of Longyi's framework agreement lies not in the paper valuation of RMB131.5 million, but in the fact that it translates "technical capability" into "supply-chain language." Only when drone companies start talking about production scheduling, repurchases, and channels does the industry truly fly from the demonstration field to the market sea. In the next few quarters, delivery data will be more honest than concepts.