The company released an interim report: revenue of 18.775 billion yuan in the first half of the year, -17.77%; realized net profit to mother 0.8 billion yuan, +16.35% year-on-year; realized net profit deducted from non-mother 0.998 billion yuan, or +67.95% year-on-year.

The company achieved revenue of 8.399/10.376 billion yuan in Q2 and +23.53% month-on-month in Q2; 24Q1/Q2 achieved net profit of 0.326/0.474 billion yuan, Q2 +45.16% month-on-month; 24Q1/Q2 achieved net profit without mother deducted 0.304/0.694 billion yuan, respectively, and +128.51% month-on-month in Q2. The company's net profit performance in Q2 was impressive, mainly due to the significant month-on-month increase in tin prices in Q2. The average price of Shanghai and tin was 0.2172/0.264 million/ton respectively, and +21.54% month-on-month in Q2. The company fully enjoyed the performance flexibility brought about by the rise in tin prices.

In terms of financial data: ① As of the first half of 2024, the company's balance ratio fell to 45.10%, down 4.14 percentage points from the end of 2023; active monetary capital was about 3.59 billion yuan, +52.04% year over year; active inventory was about 6.098 billion yuan, +10.97% year over year; ② In the first half of this year, the difference between net profit attributable to mother and net profit after deducting non-net profit was large, mainly due to disposal of inactive assets.

The world's largest producer of fine tin. As a leading enterprise in the global tin industry, the company with a deep focus on upstream resources has a full tin industry chain layout and has a strong global influence on tin, a country's strategic scarce mineral resource. According to the company's annual report, the company's domestic market share for tin metals in 2023 was 47.92%, and the global market share was 22.92%.

The company has unique resource advantages. Among the four major mining areas in Yunnan, the two major mining areas of Honghe Gejiu and Wenshan Dulong have strong integration and control capabilities, and both rank first in the world in terms of tin and indium resource reserves. By the end of 2023, the company had resources: 0.261 billion tons of ore, 0.6464 million tons of tin, 1.1672 million tons of copper, 3.7628 million tons of zinc, 4945 tons of indium, 0.0775 million tons of tungsten trioxide, 0.0954 million tons of lead, and 2491 tons of silver.

Risk warning: risk of declining grade of core mining resources; risk of price fluctuations in non-ferrous metals.

Investment advice: Maintain an “better than the market” rating.

The company's 2024-2026 revenue is expected to be 385.42/404.72/412.24 (original forecast 406.54/413.62/420.69) billion yuan, year-on-year growth rate -9.0%/5.0%/1.9%; net profit to mother is 23.29/25.88/27.88 (original forecast 23.41/25.32/27.35) billion yuan, year-on-year growth rate of 65.4%/11.1%/7.7%; diluted EPS is 1.42/1.57/1.69 yuan, corresponding PE to the current stock price is 9.9/8.9/8.3X

The company is the world's largest fine tin manufacturer. In the future, it will focus more on expanding upstream resources and building a world-class supplier of key raw materials for non-ferrous metals. Furthermore, we are optimistic about future growth in tin demand in the semiconductor and new energy sectors. The tin price center is expected to rise steadily. The company is expected to fully enjoy the performance flexibility brought about by the rise in tin prices and maintain a “superior to the market” rating.