HUAYOU COBALT(603799) 长江证券·2025-04-24 14:13Investment Rating - The investment rating for the company is "Buy" and it is maintained [7]. Core Views - The company achieved an operating revenue of 60.95 billion yuan in 2024, a year-on-year decrease of 8.08%, while the net profit attributable to shareholders was 4.15 billion yuan, an increase of 23.99% year-on-year [2][4]. - In Q1 2025, the company reported an operating revenue of 17.84 billion yuan, a quarter-on-quarter increase of 15.43%, and a net profit attributable to shareholders of 1.25 billion yuan, a quarter-on-quarter increase of 10.37% [2][4]. Summary by Sections Revenue and Profitability - In 2024, the company’s operating revenue was 60.95 billion yuan, down 8.08% year-on-year, while the net profit attributable to shareholders was 4.15 billion yuan, up 23.99% year-on-year. The net profit excluding non-recurring items was 3.80 billion yuan, an increase of 22.71% year-on-year [2][4]. - For Q1 2025, the company achieved an operating revenue of 17.84 billion yuan, a quarter-on-quarter increase of 15.43%, and a net profit attributable to shareholders of 1.25 billion yuan, a quarter-on-quarter increase of 10.37%. The net profit excluding non-recurring items was 1.23 billion yuan, a significant quarter-on-quarter increase of 62.78% [2][4]. Production Capacity and Operational Efficiency - The company’s production capacity increased significantly in 2024, primarily due to the ramp-up of the Huafei project, which contributed to a notable increase in nickel product output. The shipment of nickel intermediate products reached nearly 230,000 tons, a year-on-year increase of 50%, while nickel product sales were 184,300 tons, up 45.78% year-on-year [5]. - The company optimized its operations through reasonable hedging strategies, which contributed to performance realization. By the end of 2024, the company’s derivative financial assets were 1.001 billion yuan, down from 1.395 billion yuan at the end of 2023 [5]. Investment Gains - The company reported significant growth in investment income, achieving 1.362 billion yuan in 2024, with contributions from joint ventures and associates amounting to 743 million yuan [5]. - In Q4 2024, the net profit attributable to shareholders saw a slight decline quarter-on-quarter, primarily due to high nickel average prices realized in Q3. However, non-recurring gains and investment income in Q4 showed substantial growth, largely attributed to profit recognition from hedging [5]. Market Outlook - The company is expected to benefit from a recovery in cobalt prices and the potential for asset impairment reversals due to recent market conditions. The domestic cobalt product prices have shown signs of recovery following export bans in the Democratic Republic of the Congo [9]. - The company’s strong operational capabilities and the current market conditions present a favorable opportunity for bottom-fishing investments [9].