The company released its 2023 performance report, and the performance growth exceeded expectations. According to the company's performance report, the company expects net profit to be increased 36% year on year to 8.25 billion yuan in 2023, of which net profit after deducting non-recurring profit and loss will increase 2.73% year on year to 6.23 billion yuan. The main reason was the increase in sales of the company's main product, copper and cobalt, and the investment income obtained by arranging the Australian NPM copper and gold mine this year, which contributed to a significant year-on-year increase in performance.

The company's copper-cobalt production increased significantly in 2023. According to the company's announcement, in 2023, the company's copper production was 420,000 tons, up 51% year on year; cobalt metal production was 56,000 tons, up 174% year on year; molybdenum metal production was 15,600 tons, up 3% year on year; tungsten metal production was 7975 tons, up 6% year on year; niobium metal production was 9515 tons, up 3% year on year; and gold production was 187,000 ounces, up 16% year on year. In 2023, the company successfully put into operation the TFM mixed mine and KFM copper-cobalt mine projects in the Democratic Republic of the Congo (DRC), and copper-cobalt production increased dramatically.

Look at Wang Hongwei's copper price in 2024: global copper supply and demand are compounded by a cycle of interest rate cuts, and the increase in copper prices in 2024 is highly certain. Supply and demand level: The growth rate of global copper demand remained stable in 2024, new supply declined, and the global copper supply and demand balance became narrower; interest rate cut cycle: In 2024, the Federal Reserve entered the interest rate cut cycle with high certainty. Copper's value preservation properties are prominent during the interest rate cut cycle, and copper prices are expected to receive upward support.

Sales volume of copper-cobalt ore increased, profit forecasts were raised, and the purchase rating was raised. It is expected that the company's copper-cobalt sales revenue confirmation process will accelerate, and the company's TFM hybrid mine and KFM copper-cobalt mine will be put into operation in mid-2023. It is expected that after completing the production capacity climb, the copper production volume will be raised in 2025, and the company's 2023-2025 performance forecast will be raised. The net profit for 2023-2025 is expected to be 82.5/104/11.52 billion yuan (the original forecast net profit for 2023-2025 was 68.6/104/10.57 billion yuan). The corresponding PE is 17 times/13 times/12 times, respectively, and the corresponding PB valuation is 2.6 times. Using 2024 as a comparison benchmark, the company's 2024 PE valuation is lower than the industry average, and the PB valuation is lower than the industry average. With the company's overseas mines put into operation and production and operation are running steadily, the company is expected to usher in profit growth+valuation repair in 2024 and upgrade to a purchase rating.

Risk warning: risk of a decline in global economic growth, risk of territorial policies for overseas resources