HUAYOU COBALT(603799) 民生证券·2025-04-21 12:56Investment Rating - The report maintains a "Buy" rating for the company [5][7]. Core Views - The company achieved record high performance in 2024, with a revenue of 60.946 billion yuan, a year-on-year decrease of 8.08%, and a net profit attributable to shareholders of 4.155 billion yuan, an increase of 23.99% [12][19]. - The successful production ramp-up of the Huafei project significantly contributed to the growth in nickel products, with a notable increase in profitability [19][53]. - The company is well-positioned for future growth due to its integrated business model in lithium battery materials and strong upstream resource layout [58][59]. Summary by Sections Company Performance - In 2024, the company reported a revenue of 60.946 billion yuan, a decrease of 8.08% year-on-year, while the net profit attributable to shareholders increased by 23.99% to 4.155 billion yuan [12][19]. - For Q4 2024, the company achieved a revenue of 15.457 billion yuan, a year-on-year increase of 1.61%, and a net profit of 1.134 billion yuan, up 235.93% year-on-year [12][19]. - In Q1 2025, revenue reached 17.842 billion yuan, a year-on-year increase of 19.24%, with a net profit of 1.252 billion yuan, up 139.68% year-on-year [12][19]. Production and Sales - The company’s nickel intermediate products achieved a shipment volume of nearly 230,000 tons in 2024, a year-on-year increase of 50%, while nickel product shipments reached approximately 184,300 tons, up 46% year-on-year [2][19]. - Lithium carbonate production surged to approximately 39,000 tons, reflecting a 377% year-on-year increase, driven by the Arcadia lithium mine project [2][19]. - The company strategically reduced the shipment of low-margin products to optimize its product mix, leading to a decrease in lithium battery material shipments [2][19]. Price Trends - Nickel prices are expected to rise due to a bottoming out, while cobalt prices may rebound due to policy disruptions in the Democratic Republic of Congo [3][24]. - The average prices for key products in 2024 were 75,100 yuan/ton for copper, 12.21 USD/pound for cobalt, and 17,058 USD/ton for nickel, with respective year-on-year changes of +700 yuan/ton, -3.57 USD/pound, and -4,629 USD/ton [3][24]. Project Development - The company has made significant progress in its upstream resource projects, including the successful production ramp-up of the Huafei nickel project and ongoing developments in the Pomalaa and Sorowako projects [4][53]. - The lithium project at Arcadia is operational, with a significant increase in lithium concentrate shipments, and a new lithium sulfate project commenced construction in January 2025 [4][53]. Investment Recommendations - The report forecasts net profits for 2025-2027 to be 5.300 billion, 6.135 billion, and 6.311 billion yuan, respectively, with a price-to-earnings ratio of 11X, 9X, and 9X [5][6]. - The company is expected to benefit from its solid upstream resource layout and deep integration with international resources and automotive giants, indicating strong growth potential [5][58].