Sinomine(002738) 海通证券·2024-03-19 16:00Investment Rating - The report maintains an "Outperform" rating for the company [1] Core Views - The company is a core player in the lithium industry with rich lithium resources from Tanco and Bikita mines [5][7] - The acquisition of Kitumba copper mine and Tsumeb smelter is expected to open a new growth curve for the company [4][7] - The company's self-supply of lithium ore is expected to help control costs in the lithium business [5] - The company has completed the construction of a 35,000-ton high-purity lithium salt project and is in the trial production phase [5] Financial Performance and Forecast - The company's revenue is expected to grow from 7,383 million yuan in 2023E to 10,319 million yuan in 2025E, with a CAGR of 29.5% [6][10] - Net profit is forecasted to increase from 2,524 million yuan in 2023E to 3,757 million yuan in 2025E [6][10] - EPS is projected to be 3.46, 3.06, and 5.15 yuan per share for 2023E, 2024E, and 2025E respectively [5][6] - The company's gross margin is expected to rebound from 38.8% in 2024E to 48.5% in 2025E [6][10] Business Segments - Lithium salt segment is expected to contribute 796.46 million yuan in revenue by 2025E, with a gross margin of 47.3% [9] - Rare light metals (cesium, rubidium) segment is forecasted to generate 147.76 million yuan in revenue by 2025E, maintaining a high gross margin of 64.7% [9] - International trade segment is projected to achieve 66.34 million yuan in revenue by 2025E, with a stable gross margin of 32.3% [9] Acquisitions and Expansion - The company acquired 65% equity in Kitumba copper mine in Zambia for 49 million, which has an annual processing capacity of 260,000 tons of concentrate, potentially expandable to 370,000 tons [4] - The Bikita lithium mine in Zimbabwe is expected to produce 300,000 tons of spodumene and petalite concentrates annually by 2024 [5] Share Repurchase - The company has repurchased approximately 8.255 million shares as of February 29, 2024, with a total expenditure of around 300 million yuan [4] Valuation - The company is valued at 14-16 times PE for 2024E, with a reasonable value range of 42.84-48.96 yuan per share [5][7] - The company's P/E ratio is expected to decrease from 11.80 in 2023E to 7.92 in 2025E [10]