Investment Rating - The investment rating for the company is "Buy" (maintained) for both TFM and KFM with target prices of HKD 6.60 and RMB 8.70 respectively [1][4]. Core Insights - The company achieved a net profit attributable to shareholders of RMB 5.42 billion in H1 2024, representing a year-over-year increase of 670.4%. Revenue for the same period was RMB 102.82 billion, up 18.6% year-over-year [1]. - The copper production reached 310,000 tons and cobalt production was 54,000 tons in H1 2024, fulfilling 58% and 83% of the annual targets respectively. The company aims to achieve copper production of 800,000 to 1,000,000 tons by 2026-2028 [2]. - The copper and cobalt segment contributed significantly to profitability, with a gross margin of 52% in H1 2024, up from 42% in the previous year, driven by a 4% increase in copper prices year-over-year and a 16% increase quarter-over-quarter in Q2 2024 [3]. Financial Performance - For H1 2024, the company reported revenue of RMB 102.82 billion and a net profit of RMB 5.42 billion, with Q2 revenue at RMB 56.70 billion, showing a year-over-year increase of 33.6% and a quarter-over-quarter increase of 22.9% [1][2]. - The projected net profits for 2024, 2025, and 2026 are RMB 10.93 billion, RMB 12.76 billion, and RMB 17.63 billion respectively, indicating a strong growth trajectory [5]. - The company’s PE ratio for 2024 is estimated at 17.1X, compared to the average PE of comparable companies at 13.2X [1][6]. Production Capacity and Expansion - TFM's mixed ore project has successfully reached production capacity, with five production lines established, yielding an annual capacity of 450,000 tons of copper and 37,000 tons of cobalt, making it the fifth largest copper mine and second largest cobalt mine globally [2]. - KFM has established an annual production capacity of 150,000 tons of copper and 50,000 tons of cobalt, maintaining its position as the world's largest cobalt mine [2]. - The company is actively pursuing expansion projects, including the Nzilo II hydropower station cooperation agreement and ongoing exploration work for KFM Phase II [2].
洛阳钼业：TFM、KFM进入火力全开状态