Implications of the Ceres-2 Launch Failure on Investment Risk Assessment in Commercial Space

Based on the latest information retrieved, I will systematically analyze the implications of the Ceres-2 launch failure on investment risk assessment in commercial space.

According to Xinhua News Agency, at 12:08 on January 17, 2026, the Ceres-2 private commercial launch vehicle under Beijing Galactic Energy Aerospace Technology Co., Ltd. experienced abnormal flight after igniting and lifting off at the Jiuquan Satellite Launch Center, resulting in the failure of its maiden flight test mission. The specific cause is under further investigation and analysis [1]. Notably, on the same day, the Long March 3B launch vehicle of China Aerospace Science and Technology Corporation also failed in its launch of the Shijian-32 satellite [3].

The failure of Ceres-2 is not an isolated incident, but a typical characteristic of the technology verification phase of commercial space. SpaceX in the U.S. also experienced multiple launch failures during its development; its Falcon 1 rocket failed in the first three launches, and only achieved success in the fourth launch in September 2008 [7]. This ‘trial-and-error iteration’ model is an objective law for aerospace technology development. Commercial space enterprises are generally in the phase of ‘high R&D investment, low net profit’, and losses are the industry norm rather than an individual case [8]. Galactic Energy has previously completed 21 commercial launches and successfully placed 89 satellites into orbit [4], which precisely proves that aerospace technology verification requires sustained capital investment and accumulation of failure experience.

Galactic Energy is in the critical stage of IPO tutoring on the STAR Market; the company completed tutoring registration in October 2025, and the industry expects that it can submit a prospectus in the second quarter of 2026 under optimistic circumstances [4]. This failure may cause a short-term impact on capital market confidence, but referring to international experience, SpaceX’s launch failures did not affect its financing capacity and valuation growth, with its valuation reaching $350 billion by December 2024 [7]. For investors, it is essential to distinguish between two concepts: ‘technology verification failure’ and ‘lack of commercial capability’ — the former is an inevitable path for technological iteration, while the latter is a genuine investment risk signal.

Investment in commercial space should adopt a three-dimensional ‘orders + pipelines + technology’ model for comprehensive assessment: evaluate the certainty of current cash flow based on existing orders and revenue; assess future growth potential in conjunction with the deployment of new products/businesses/capacity pipelines; and add growth premium brought by key technological breakthroughs [2]. Investors need to establish reasonable psychological expectations and risk tolerance for failures during the technology verification phase.

As a new model making its maiden flight, the failure of Ceres-2 is more likely to fall into the category of technical debugging; if a mature model repeatedly fails, it may point to deeper management or supply chain issues. Galactic Energy’s Ceres-1 sea-launch variant has achieved 100% success in 6 launches [4], proving that its core technical capabilities have been verified.

The simultaneous failure of the Long March 3B launch vehicle on the same day indicates that space launch failures may be related to multiple factors such as supply chains and technical route selection. Investors should pay attention to the upstream suppliers, supporting service providers of the involved companies, and the execution status of existing orders, and assess whether the failure event will lead to customer trust loss or order cancellation.

From an industrial perspective, China’s commercial space is evolving from technological catch-up to partial innovation. In December 2025, the Zhuque-3 Y1 launch vehicle of LandSpace successfully entered orbit and completed the first-stage recovery test [8], marking that domestic recoverable rocket technology is making substantive breakthroughs. At the policy level, on December 26, 2025, the Shanghai Stock Exchange released the Guidelines on the Fifth Set of Listing Standards on the STAR Market Applicable to Commercial Rocket Enterprises [2], providing a clear capital exit channel and valuation anchor for the industry. The underlying supports for industry development — policy support, technological progress, constellation networking demand, and capital resonance — have not fundamentally changed due to a single failure [6].

For investors with different risk preferences, differentiated strategies are recommended:

: Focus on state-owned enterprises such as China Satcom, China Spacesat, and China Aerospace Engineering Group. As core contractors of China’s aerospace projects, these enterprises have low ‘zero-out risk’ and stable order sources [2].

: Focus on private supporting enterprises such as Galactic Energy, Lvzhi Technology, and Nalite. They are deeply embedded in the high-growth chain of commercial space; although they have high volatility, they possess strong growth potential [2].

: The current commercial space sector is highly popular, and the valuation of some enterprises has seriously deviated from fundamentals. In December 2025, companies such as Shenjian Co., Ltd. and Haozhi Electromechanical issued stock price risk warning announcements, clearly stating that their stock prices have seriously deviated from fundamentals [2]. Investors should prioritize risk prevention and control, with value identification as the core criterion.

The maiden flight failure of Ceres-2 is a typical case in the development of commercial space, providing important risk education materials for investors. The inherent characteristics of aerospace technology determine that failure is an integral part of the verification process; the key lies in whether the enterprise can learn from failures and iterate rapidly. For investors, establishing a scientific risk assessment framework, distinguishing between technology verification risks and commercial capability risks, and maintaining investment resolve with a long-term perspective are core capabilities to obtain excess returns in this highly volatile track. As a strategic emerging industry, the long-term development trend of commercial space remains clear, but investors need to treat short-term fluctuations more prudently and avoid irrational valuation speculation.

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[1] Xinhua News Agency - Failure of the Maiden Flight Test Mission of the Ceres-2 Private Commercial Launch Vehicle (http://www.news.cn/20260117/b1a13297f98e411da8650006a18d1d95/c.html)

[2] Wall Street CN - Commercial Space 2026: The Singular Moment From Great Power Narrative to Commercial Closed Loop (https://wallstreetcn.com/articles/3762511)

[3] Lianhe Zaobao - China’s Private Rocket Ceres-2 Fails in Maiden Flight Mission (https://www.zaobao.com.sg/realtime/china/story20260117-8115671)

[4] Securities Times - 2026 “Maiden Flight” of Commercial Space: Successful Launch of Ceres-1 (https://www.stcn.com/article/detail/3596902.html)

[5] Securities Times - Capital Frenzy Scrambles for Positions in Commercial Space (https://www.stcn.com/article/detail/3580366.html)

[6] China Newsweek - Trillion-Yuan Windfall, Stock Prices Soar (https://www.jwview.com/jingwei/html/m/01-06/652848.shtml)

[7] Yuzhou - SpaceX Rocket Trial-and-Error History (https://news.qq.com/rain/a/20250828A07WVW00)

[8] 36Kr - Commercial Space Stocks Soar and Plunge, Losing Billions at Will: Unpacking the Behind-the-Scenes Money-Burning Logic (http://www.36kr.com/p/3639019671440517)