share_log

华钰矿业(601020)中报点评:战略布局贵金属 业绩估值或双提升

Huayu Mining (601020) report comments: strategic layout Precious Metals performance valuation or double improvement

廣發證券 ·  Aug 28, 2019 00:00  · Researches

Core ideas:

The decline in the price of the main products leads to a decline in performance.

According to the company's semi-annual report, in the first half of 2019, the company achieved an operating income of 234 million yuan and a net profit of 39.06 million yuan, a decrease of 66.7% compared with the same period last year. The sharp decline in performance is mainly due to a sharp decline in the prices of lead, zinc and antimony metals in the first half of the year compared with the same period last year. In addition, performance declined as a result of lower inventory at the beginning of the first half of the year than in the same period, coupled with reduced production and sales as a result of the short production cycle.

High-quality mines have a solid foundation, and overseas projects have been steadily promoted.

The company's main domestic mine Zaxikang polymetallic mine has strong profitability, even if the metal price is depressed, it can still maintain a high gross profit. It now has a mining capacity of 700000 tons and a mineral processing capacity of 2800 tons per day. Overseas Tajin projects are progressing steadily, and gold production is about to be released. According to the financial report, at the beginning of 2020, the annual ore handling capacity of Tal Gold was put into production, with an annual design capacity of 1.5 million tons of gold concentrate and 16,000 tons of antimony concentrate. In addition, the recently acquired Ethiopian Tigre Resources Company accounts for 70% of the shares and has gold reserves of 9.5 tons of metal, which will further increase the company's gold production as the project progresses.

Investment suggestion

According to the average price of gold, silver, antimony, zinc and lead since the beginning of the year, it is estimated that the EPS of the company from 2019 to 2021 is 0.230.64 and 0.80 yuan respectively, and the PE of the corresponding share price is 42-15-12, considering that the original business profit of the company is in the stage of bottoming out. After the company is put into production, the company's revenue is expected to increase by 78%, and the company's profit is expected to increase by 178%. The precious metal sector accounts for nearly 50 per cent of total revenue in 2020 (excluding price increases), which may lead to both performance and valuation gains. The average PB of the same type of company in the reference industry is 4.1 times, the company is in the process of transformation, the PB is 3 times, and the reasonable value is 11.98 yuan. In view of Huayu Mining's 2020 performance valuation by leaps and bounds, 15 times PE is far lower than the company's average 35 times, maintaining a "buy" rating.

Risk hint

The trade war continues to worsen; the production of Tal gold project falls short of expectations; and the price of precious metals fluctuates sharply.

The translation is provided by third-party software.


The above content is for informational or educational purposes only and does not constitute any investment advice related to Futu. Although we strive to ensure the truthfulness, accuracy, and originality of all such content, we cannot guarantee it.
    Write a comment