BoCom International maintains the investment rating of China Iron Titanium (00893-HK) and gives it a target price of 4.7 yuan. It is expected that the company's earnings per share will reach 0.30 yuan and 0.36 yuan respectively in 2011 / 2012, compared with 8.9 times and 7.5 times of PE in 2011 / 2012, respectively. As an iron ore mining and dressing enterprise which is in a period of stable development, we think the valuation of the company is on the low side.

BoCom said it achieved a substantial increase in 2010 thanks to higher iron ore production and higher iron ore sales prices. The company's main operating income and net profit were 1.554 billion yuan and 533 million yuan respectively, an increase of 43.4% and 62.7% respectively over the same period last year, realizing basic income per share of 0.26 yuan. The company has formed an iron concentrate production capacity of 2.5 million tons and will continue to increase iron ore reserves and increase the proportion of deep-processed products in the future.

China Iron and Titanium fell 1.82 per cent to HK $3.23 yesterday.