Goldman Sachs published a research report saying that the Mongolian coal industry will continue to benefit from Mongolia's continued increase in coking coal exports to China, but the bank believes that the Mongolian Coking Coal Industry (0975.HK) profit for fiscal year 2011 is at risk. Mainly due to the decline in China's crude steel production, China's demand for coking coal declined significantly in the fourth quarter of last year. The bank maintained its “buy” investment rating for its “purchase”, but lowered its 12-month target price from 7.5 yuan to 7.3 yuan.

Goldman Sachs pointed out that the stock price of the Mengjiao Coal Industry has risen 8% since the fourth quarter of 2011, HSCEI rose 34% during the same period, and China's coal mine stocks rose 33%. At the same time, the market's consensus on its profit expectations for fiscal year 2011 was lowered by 22%, reflecting that the market had already exceeded expectations for fiscal year 2011, which was reflected in stock prices. Goldman Sachs expects the net profit of the Mengjiao Coal Industry to be 112 million US dollars and 297 million US dollars respectively in 2011 and 2012, with a basic profit of 0.03 US dollars and 0.08 US dollars per share. The price-earnings ratio during the period will be 26.5 times and 10 times respectively, and the return on equity during the period will be 14.3% and 30%.