occurrences
According to the official website of China Mining Resources, on March 7, in Windhoek, the capital of Namibia, China Mining (Hong Kong) Rare Metals Resources Co., Ltd., a wholly-owned subsidiary of China Mining Resources, reached an agreement with Dundee Precious Metals Ins. The subject of the acquisition was 98% of the issued shares of Dundee Precious Metals Tsumeb Holding (Pty) Ltd. (“DPMTH”) held by DPM, with a transaction consideration of $49 million in cash. DPMTH's main asset is the TsumeB smelter in Namibia.
reviews
The Tsumeb smelter has advanced technology, and production capacity can be increased by 42% after technical improvements. Tsumeb smelter is one of the few specialty smelters in the world that can handle complex concentrates such as high-arsenic copper concentrates. Currently, the smelter's concentrate processing capacity is 260,000 tons/year, and the main products are crude copper and sulfuric acid. Through technological upgrading, concentrate processing capacity is expected to be increased to 370,000 tons/year.
Copper mining has been around for a long time and is expected to become the third main business. Currently, the company's copper mines are mainly found in Zambia: the total amount of copper ore in the Shifuma copper mining area is 304.69 million tons, with an average grade of 0.73%; the 2023H1 mine volume is 40,000 tons, with an average copper average of 1.52%; the total ore volume of the two ore bodies in the Kashihi copper mine is 3.22,600 tons, with an average copper content of 2.17% and a copper metal content of 70,000 tons. 2023H1 The acquisition of Tsumeb's smelter is expected to form a partnership with copper mines such as Zambia to boost the copper sector and become the main business that goes hand in hand with the lithium business and rare metals business.
Bikita has begun shipping spodumene, and costs are expected to drop further. On September 7, 2023, local time in Zimbabwe, the first batch of 10,000 tons of spodumene concentrate powder from the Bikita mine in Zimbabwe, which belongs to the company, began to be shipped back to China to supply the raw material requirements of the 35,000 tons of battery-grade lithium hydroxide and battery-grade lithium carbonate production line under construction, indicating that the Bikita mine's spodumene production line has been able to supply spodumene concentrate powder in a stable manner. In addition to this, the lithium-permeable feldspar renovation and expansion production line at the Bikita mine continues to be produced, and the lithium-permeable feldspar concentrate produced continues to be transported to the country.
Currently, it is 60,000 tons and 100,000 tons in the future, and the growth rate is excellent. The company currently has an annual production capacity of 25,000 tons of battery-grade lithium carbonate/lithium hydroxide. At the same time, the company's new high-purity lithium salt project with an annual output of 35,000 tons was completed and successfully put into trial production on November 16, 2023. Currently, the climbing situation is smooth. Currently, the company will have a total production capacity of 60,000 tons/year of battery-grade lithium carbonate/lithium hydroxide. At the same time, the company will continue to increase the self-sufficiency rate of lithium ore resources, continue to expand production capacity for new energy raw materials, gradually achieve 100,000 tons of high-purity lithium salt production capacity, and be completely self-sufficient in mineral resources.
Profit forecasting
The company's net profit for 2023-2025 is estimated to be 2,638/27.14/3.486 billion yuan, respectively, with a corresponding EPS of 3.61/3.72/4.78 yuan, and a corresponding PE of 10.62/10.32/8.04 times, maintaining a “buy” rating.
Risk warning:
The price of lithium salt fluctuates greatly; the company's production capacity construction falls short of expectations; demand for new energy vehicles falls short of expectations; overseas political risks.