Investment bank Berenberg, alongside Goldman Sachs, is hosting a significant conference in Munich from September 21st to 23rd, focusing on space and key technologies. Their 183-page report, titled Aerospace & Defence – More than a Moonshot, emphasizes the expanding investment opportunities within the space sector.
Key Insights from the Report:
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Growth of the Space Economy:
- The space economy is projected to surpass $500 billion by 2025 and may exceed $1 trillion by 2030. This growth is driven by reduced launch costs.
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Recommencement of Analysis:
- Berenberg has resumed its analysis of the space sector, highlighting companies like Rocket Lab, AST SpaceMobile, Planet Labs, HawkEye 360, and Avio SpA.
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Impact of Reusable Rocket Technology:
- Launch costs have dropped significantly, making once-unfeasible applications viable. For instance, costs have decreased from approximately $54,000/kg with the Space Shuttle to below $1,000/kg with Falcon 9.
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Market Dynamics:
- SpaceX dominates the launch market, delivering 80% of mass to orbit year-to-date. Their pricing strategies and future capacity could create a further bottleneck if they restrict flights for internal projects.
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Shifts in Satellite Deployment:
- The industry is moving from small constellations of large satellites to large constellations of small satellites, creating consistent demand for launches and manufacturing.
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Future Application Trends:
- As costs decrease, value is shifting to applications and data, with increasing demand for capabilities like LEO broadband (e.g., Starlink) and unique data from Earth observation (e.g., Planet Labs).
Berenberg suggests a focus on vertically integrated launch capabilities and differentiated applications that are difficult to replicate, aligning investment strategies with companies that exhibit potential for scalability and sustainable demand.
