On December 26, the company disclosed that the first phase of the Hengyang Copper-lead-Zinc Base project was successful, marking the steady and smooth pace of the company's transformation. It is expected that in 19 years, with the smooth progress of production capacity transfer and the recovery of superimposed zinc processing fees, the company's performance is expected to become positive, giving a "prudent recommendation-A" investment rating.
Integration, upgrading, non-ferrous smelting leader coruscate a new life. As early as 14 years, the National Development and Reform Commission issued a document in which the Qingshuitang of Zhuzhou City was included in the first batch of pilot areas for the relocation and transformation of the old industrial zones in 21 urban areas of the country, and then Hunan Province and Zhuzhou City followed up. It is clearly proposed that the smelting enterprises in the Qingshuitang Industrial Zone should be relocated at the end of the 18th. From the point of view of "enterprise integration and industrial upgrading", the company plans to "withdraw from the city and enter the park" through the overall relocation to Changning, Hengyang, to solve the two major difficulties of Zhuye exit, Shuikoushan environmental governance and upgrading, and to achieve the "win-win" of the government, enterprises and residents.
Smelting capacity decline but quality improvement, after the integration of the new base will achieve strategy, efficiency, environmental protection and other aspects of upgrading. The company has an original zinc smelting capacity of 550000 tons and electric lead production capacity of 100000 tons; Hengyang Shuikoushan has an original production capacity of 100000 tons of electric lead, 80,000 tons of crude lead and 80,000 tons of zinc; and gold and copper has a production capacity of 100000 tons of cathode copper. After the completion of the project integration, the copper-lead-zinc base will form a production capacity of 300000 tons of zinc, 100000 tons of electric lead and 300000 tons of cathode copper, the capacity structure is in line with the strategic positioning of the group, the project efficiency is higher than the industry benchmark level, and the discharge standards meet the latest standards.
The first phase of the new copper-lead-zinc industrial base project achieved a success, indicating that the company's capacity transfer is progressing smoothly.
Affected by the shortage of raw materials and the transfer of production facilities, the company's total lead and zinc output in the first half of the year only achieved 40% of the annual target; at the same time, affected by an one-time provision, the company's Q3 achieved revenue of 8.967 billion, year-on-year-11.22%; net profit-1.572 billion, year-on-year-684%. Whether the new and old kinetic energy can be converted smoothly has become the "winning or losing hand" that affects the stability and sustainable operation of the company. The success of this project marks the smooth progress of the company's project construction and the initial results of technological upgrading.
The contradiction of zinc supply turned to the smelting end, and the processing fees rose, giving a "highly recommended-A" investment rating. The recent tightening of the national environmental protection side and the long-term low processing fees have led to the clearing of some production capacity, and the contradiction in domestic zinc supply has gradually shifted to the smelting end. It is expected that zinc processing fees will be out of a wave of upward trend, good for smelting enterprises. In 18-19-20, the company is expected to achieve a net profit of-12.9, 2.2, PE=-3.1/17.9/8.7X, with an investment rating of "prudent recommendation-A".
Risk hints: the project construction is not as expected, the government subsidy funds can not be put in place as scheduled, and the risk of zinc price fluctuation.