$JLMAG (06680.HK)$ Against the market trend, it rose over 7%, as of the time of writing, reported at 13.76 HKD, with a trading volume of 95.1546 million HKD.

Dongxing released a Research Report stating that in 2024, the price trend of rare earth raw materials is declining. Taking Metal Praseodymium and Neodymium as an example, the average price in 2024 is 0.49 million yuan/ton, a decrease of about 25% compared to the 0.65 million yuan/ton average price in 2023. Although the total sales volume of high-performance Rare Earth Permanent Magnets for the company in 2024 is 0.0209 million tons, a 37.88% increase from last year, the price drop offsets the volume increase. The growth rate of Net income does not match the revenue growth rate, primarily due to the lag in raw material cost changes, compounded by intensified Industry competition and other factors. The gross margin for 2024 is 11.13%, a decrease of 4.94 percentage points compared to the gross margin of 16.07% in the same period of 2023. With the execution of lock price Orders, the company's profitability has gradually improved in the third and fourth quarters. Looking forward to this year, after rare earth prices stabilize at the bottom, the company's profitability is expected to steadily improve.

Zhongyou Securities pointed out that in 2024, the company’s production of Neodymium Iron Boron magnetic steel finished products will be 0.0216 million tons, a year-on-year increase of 42.40%, primarily benefiting from the launch of construction projects and ramp-up in production. By the end of 2024, the company will have a production capacity of 0.038 million tons/year for high-performance Rare Earth Permanent Magnets. It is expected that in 2025, 0.04 million tons of high-performance Rare Earth Permanent Magnets capacity and advanced humanoid robot magnetic component production lines will be established. Moreover, rare earth prices declined by 25% in 2024 and increased by 11% in Q1 2025. The average price of rare earths in 2024 is projected to be 25% lower than in 2023, stabilizing since Q2 2024. By the end of March 2025, Metal Praseodymium and Neodymium prices rose by 11%, showing a steady upward trend. The bank believes that considering the gradual stabilization and increase of rare earth prices, the company's Business profitability is likely to recover, coupled with the ramp-up of projects in hand, the company’s production and sales volume will continue to grow.

Editor/Rocky