24Q1's net profit to mother increased 166.41% year-on-year, maintaining that the 24Q1 purchase rating company achieved revenue of 1,854 million yuan, yoy +16.83%, and qoq -14.12%; net profit to mother of 210 million yuan, yoy +166.41%, and qoq -29.41%. We maintain profit expectations. The company's net profit for 24-26 is estimated at 1,526/20.87/2,291 billion yuan, respectively. Comparatively, the company's 24-year Wind unanimously anticipated PE 28X, giving the company a 24-year 28XPE with a target price of 26.14 yuan (previous value: 26.68 yuan), maintaining a “buy” rating.
The price of gold rose faster than the cost of sales. The company's net profit for 24Q1 increased 166.41% year on year. According to Wind, the average price of gold settlement in the first period of 23Q1 and 23Q4 was 419.94 yuan/gram and 472.06 yuan/gram. The average price for 24Q1 was 490.24 yuan/gram, up 16.74% and 3.85% year over month, respectively.
The company's 24Q1 mineral gold production and sales volume were about 3.59 and 3.58 tons, +9.03% and +1.18% compared with the same period last year.
However, the company's mineral gold sales cost was about 300.51 yuan/gram, +4.27%; of these, the sales cost of gold from Venus and domestic mines was +7.59%, +7.11%, and Vientiane Mining -5.47%. The year-on-year increase in gold prices was significantly higher than the increase in costs, and net profit yoy increased by 166.41% in 24Q1. The company's target for mineral gold production in '24 is 16.02 tons. It is expected to increase 9.7% compared to the forecast for mineral gold production in '23.
Gold is still in an upward channel. The current price of LME gold may rise by more than 3,000 US dollars/ounce in the current cycle, and the central bank's demand for large gold purchases in 22-23 years has gradually replaced investment demand such as gold ETFs and physical gold, and has become the leading factor affecting the rise in gold prices during the interest rate hike cycle. Looking ahead to the future market, since the share of gold reserves in major central banks is still low in recent years, against the backdrop of anti-globalization, declining US dollar credit, and geopolitical normalization, the global central bank gold purchase trend is likely to continue; it has a good supporting effect on gold prices. At the same time, as the time for the Federal Reserve to begin the interest rate cut cycle approaches, investment demand for gold ETFs, physical gold, and net futures gold positions will return. Due to the resonance of multiple positive factors, we believe that the price of gold is expected to break through $3,000 per ounce in this 24-25 upward cycle.
Risk warning: The company's expansion of production fell short of expectations, and the pace at which the Federal Reserve cut interest rates fell short of expectations.