Events: the controlling shareholder signed a comprehensive strategic cooperation agreement with the Chenzhou Branch of Agricultural Bank Of China Co., Ltd.; the company signed a comprehensive strategic cooperation agreement with the Chenzhou Branch of Agricultural Bank Of China Co., Ltd.; the controlling shareholder signed a financial advisory agreement with the Hunan Branch of Great Wall Asset Management Co., Ltd.
Great Wall assets and Agricultural Bank Of China's 4.17 billion yuan rescue fund are in place to fully support the development of the company. China Great Wall assets Hunan Branch and China Agricultural Bank Of China Chenzhou Branch signed cooperation agreements with Jingui Silver and Hunan Jinhegui Mining Co., Ltd., with a cooperation capital of up to 4.17 billion yuan. According to the financial advisory agreement signed, China Great Wall assets Hunan Branch will provide debt restructuring, asset restructuring, management restructuring and year-round comprehensive financial advisory services for Jinhe Mining Industry, including the initial contribution of 1.17 billion yuan and the completion of mining acquisition debt restructuring of your mining industry. This marks a substantial breakthrough made by Hunan Branch of China Great Wall assets in rescuing Jingui Silver Industry and its major shareholders, and various cooperation projects will be fully implemented to solve the liquidity difficulties of major shareholders of Jingui Silver Industry in a package. And help it restore the financing guarantee ability to the gold, precious and silver industry. China Great Wall assets Hunan Branch will further invest funds to resolve the liquidity difficulties of major shareholders in the gold, precious and silver industry. China Agricultural Bank Of China Chenzhou Branch will provide quality and preferential comprehensive financial services and support to gold, precious silver, gold and your mining industry, with an intended credit amount of 3 billion yuan, including 1.5 billion yuan each for gold, precious silver, gold and precious mining.
The company is the domestic silver leader, the layout of the whole industrial chain, to create a silver empire. The company was founded in 2004, mainly engaged in silver smelting and deep processing, has basically formed a silver-rich lead concentrate-lead anode slime-silver (and comprehensive recovery of other valuable metals)-silver products deep processing-"Internet +" industrial chain system, silver output is expected to reach 2000 tons in 2019, ranking first in the country, accounting for about 10% of the country, accounting for about 7% of the world.
The upstream continues to acquire mines to improve the self-sufficiency rate of raw materials. The company acquired Tibetan Gold and Mining and Junlong Mining in 2016 and 2017 respectively, enhancing the company's self-sufficiency in raw materials such as silver and lead. In May 2018, the company announced plans to acquire a 65% stake in Chifeng Yubang Mining. Yubang Mining's Shuangjianzishan Silver-lead-Zinc Mine, which has silver reserves of more than 18000 tons, is currently the largest silver mine in Asia. If the acquisition is successful, the company's profitability will increase exponentially.
Profit forecast and rating. Taking into account the marginal slowdown of the US economy, higher precious metal prices are a high probability event. To maintain the company's buy rating, the company's EPS is expected to be 0.42,0.56 and 0.66 yuan respectively from 2019 to 2021, corresponding to a PE of 16.3,12.3 and 10.5 times.
Risk tip: metal prices are lower than expected.