1. Event

Jianxin Mining has many outstanding commitments since its restructuring in 2013, some of which still have a significant impact on the current share price.

two。 Our analysis and judgment

(1) commitment to inject Xinzhou Mining assets

On April 25, 2014, Jianxin Group and Liu Jianmin promised: subject to the approval of 45% equity asset securitization held by Jiugang Group, a major shareholder of Gansu Xinzhou Mining Co., Ltd., Xinzhou Mining will improve the relevant procedures and warrants, and within one year after meeting the evaluation conditions, Jianxin Group will immediately inject 40% of the equity equity held by Xinzhou Mining into the listed company. The injection of the asset is expected to be completed no later than 2017 at the latest. If it is not completed in 2017, Jianxin Group has agreed to compensate the listed company 20 million yuan and withdraw its commitment to inject the asset.

In April 2015, the company received a letter from the controlling shareholder, and all the shareholders of Xinzhou Mining agreed to inject their shares into the listed company at the same time. However, the behavior and process of the transfer of equity in listed companies can only be implemented after the state-owned shareholders of Xinzhou Mining have completed the relevant procedures for the disposal of state-owned assets. at present, shareholders are stepping up the process to start the injection of Xinzhou Mining as soon as possible.

Xinzhou Mining is a mature tungsten mine

Xinzhou Mining was founded on August 4, 2005, with a registered capital of 227.7653 million yuan. Its main business is tungsten-molybdenum-copper mining, processing and sales. Xinzhou Mining Industry has the mining and separation capacity of 270,000 tons of tungsten ore per year, and has obtained the mining right and exploration right of Xiaoliugou tungsten-molybdenum mining area and the exploration right of Xianniugou coal mine area.

(2) 100% equity injection of Chinese and Western Mining by the end of 2016

Inner Mongolia Zhongxi Mining Co., Ltd. will inject a 100% stake in the company into a listed company by the end of 2016.

Chinese and Western Mining Industry is a large mature molybdenum mine.

According to the news of August 03, 2015, from January to June 2015, Zhuozi County Zhongxi Mining Co., Ltd. produced a total of 1746 tons of molybdenum powder, processed a total of 1.735 million tons of raw ore, sales revenue of 167.92 million, and achieved a tax revenue of 29.54 million. Among them, the plant stopped production in February and March and resumed production around April 1. The price of molybdenum fine powder is 5 million tons in April. The expansion project is under construction and is expected to be put into use in September.

According to the official website of Chinese and Western Mining, the company has an exploration right area of 4.18Km2 and a mining right area of 1.68 Km2. By 2010, it has identified molybdenum metal reserves of 150000 tons, associated gold of 3.53 tons, silver of 24.79 tons, mineral volume of 113 million tons, and an average grade of 0.133%. As the boundary of the orebody has not been completely controlled, the peripheral and deep prospecting continues, and the estimated reserves are more than 200000 tons. The deposit is a crust-derived porphyry molybdenum deposit, ranking in the forefront of similar mines in the country. The mine was built in 2005, and Jianxin Group integrated resources and equity restructuring in 2008. Approved by the Economic Commission of the Autonomous region, 2.2 billion yuan was invested in the technical transformation of the mining project, which was designed by Changsha Nonferrous Metallurgical Design Institute, started construction in May 2010 and trial production at the end of August 2012. Key industrial construction projects in Inner Mongolia Autonomous region and Wulanchabu City. The actual production scale of the enterprise will reach 5 million tons, with an annual output of 12000 tons of molybdenum concentrate, 6000 tons of metal, and an annual output value of 1.5 billion yuan, creating a tax revenue of 300 million yuan for local finance and providing 1500 social jobs. At the same time of the construction of the mining and separation project, the research and demonstration of the molybdenum concentrate deep processing project has been carried out, and the enterprise output value will reach more than 2.5 billion yuan. The technical renovation project is expected to be completed by the end of 2014.

According to the current price of 12000 tons of molybdenum concentrate, the sales income is about 500-600 million yuan. Taking into account by-product output, Chinese and Western mining sales revenue will increase slightly. Since 2010, the company is still in the process of exploration, and the author expects the mine reserves to increase compared with the 2010 annual meeting.

(3) Jinde Integrity is expected to be injected in 2017.

Shanxi Jinde Chengxin Mining Co., Ltd. injected into listed companies within 2 years after the company was completed and put into production, and is expected to be injected into listed companies in 2017.

According to the detailed geological survey in 2010, the proved reserves of molybdenum ore and molybdenum metal in the mining area are 314 million tons and 171000 tons respectively.

The development of Houyu Copper-Molybdenum Mine in Fanshi County is carried out by open-pit mining, with the construction of 1000 million tons / year molybdenum mine technical transformation mining and separation project, 300000 tons / year sulfuric acid production line and molybdenum product deep processing project. The project is divided into two phases, the first phase is to build 5 million tons / year molybdenum mining and separation technical renovation project, 300,000 tons / year sulfuric acid production line and molybdenum products deep processing project, and the second phase is to build another 5 million tons / year molybdenum mining and separation technical transformation project.

According to the official website of Jinde Integrity on 2010-11-29, after the completion of the 5 million tons / year mining and separation technical renovation project of Fanzhi Houyu Copper and Molybdenum Mine, it is expected to invest 4.5 billion yuan. Build into 1000 million tons / year molybdenum mine technical transformation mining and separation project, 300,000 tons / year sulfuric acid production line and molybdenum product deep processing project. After the completion of the project, it is expected to achieve sales revenue of 3 billion, profits and taxes of 1.2 billion yuan, and provide more than 2000 local jobs.

3. Investment suggestion

The company has excellent fundamentals, taking into account the expected injection of tungsten and molybdenum resources, and the injection is a large-scale mature mine. At present, A-shares give higher valuations to listed companies in the molybdenum and tungsten industries. We judge that the price difference of tungsten and molybdenum resources in the secondary market and the primary market is still huge. After the injection of resources, the valuation of listed companies will be greatly improved and the company will be recommended and rated.

Zinc prices have risen 27% since the beginning of the year, zinc mines are in short supply, and zinc prices are expected to be very sustained. Despite the low zinc price in 2015, 284 million yuan can still be deducted from non-return net profit, which is expected to improve significantly this year. Mine reserves increase by more than 50%, the mine contains cobalt, and there is room for imagination of capital operation, the current market capitalization is only 11.4 billion yuan.

4. Risk hint

The price of lead and zinc fell sharply.