The company's 2014 performance was lower than the market consensus and our estimates. The company's revenue increased by 301.5% year-on-year to 3.39 billion yuan, and recorded a net profit of 77.8 million yuan for shareholders.

Due to weak demand, we expect nickel prices to fall in 2015, and we also expect copper prices to fall slightly and remain low in 2015. Due to the increasingly obvious slowdown in China's economic growth, we expect consumer demand for nickel to remain weak in 2015 and nickel prices will continue to fall.

The company's production of nickel and copper minerals is expected to increase steadily in 2015, while production of refined copper is expected to double in 2015. The company plans to produce 11200 tons of electrolytic nickel and 85562 tons of refined copper, and we expect the company to meet its production target.

Downgrade Xinxin Mining's target price to HK $1.51 and its "underweight" rating.