2023-2025 volume and price forecast:

Copper: the company will actively expand the basic business of copper production in the next three years. We expect copper tube sales of 71max 88 / 1.08 million tons, copper rods of 25x32 / 420000 tons and copper bars of 4shock of 5 / 100000 tons.

Copper foil: with the gradual expansion of domestic and overseas bases, we expect the total sales of copper foil to be 3gam8 / 150000 tons in 2023-2025.

Processing fee: due to the improvement of real estate completion data, we estimate that the average processing fee per ton of copper will pick up to 5700 kilogram in 2023-2025, and the average processing fee of lithium copper foil in 2023-2025 is expected to be 109.2 / 88000 yuan per ton.

From 2023 to 2025, we expect the company to achieve operating income of 851.5x1027.5 / 125.4 billion yuan, return to its mother net profit of 17.3company23.4 / 3.2 billion yuan, PE valuation of 13.7Universe 10.1max 7.4 times, select Jintian shares, Bowei alloy, Nord shares, Jiayuan Technology as comparable companies, Hailiang shares PE valuation lower than comparable company valuation, to give "overweight" rating.

Risk hint

1. The impact of large fluctuations in copper prices: will the fluctuation of copper prices affect the company's revenue? 2. Intensified competition in the industry will lead to accelerated reduction of processing fees: the higher-than-expected production expansion of other companies in the industry may lead to a price war of processing fees, which is not conducive to the company's profit level.

3. The company's production expansion is not as expected: the company's multi-project technical transformation and production are in progress, and if the progress is not as expected, it will have a greater impact on the company's operating performance.

4. New business technology upgrading: copper tube, copper foil and other industries are currently in the process of iterative upgrading of new technologies. If the company does not actively follow up on relevant technologies, revenue and profits will be affected.

5, downstream demand is lower than expected: copper pipe is affected by real estate completion demand, copper foil is affected by new energy vehicle sales, if the above two demand is not as expected, the growth rate declines and so on, the company's performance will be dragged down.

6. RMB exchange rate fluctuation risk: the company's overseas income accounts for more than 40%. If the exchange rate fluctuates sharply, the company's performance will be affected.