Yunnan Copper (000878): Mining, dressing and smelting in 2020 is expected to fully transform the potential of production resources
The performance of the first three quarters of 2019 was beautiful, and Q4 volume parity rose. Considering the impairment factor at the end of the year, it is expected that the growth rate will remain high in 2厦门夜网019.
First, in the first three quarters of 2019, the company benefited from the expansion of the consolidated copper smelting and smelting capacity of the Pulang copper mine.
1.7 billion, +44 a year.
78%. Considering the stable release of Q4 output and the slightly higher copper price and Q3, it is expected that the company’s Q4 main business profit will even improve month-on-month.
Second, on December 21, the company announced that it is expected to accrue asset impairment losses2.
1.7 billion, mainly for accounts receivable 2 formed in February 2012 for Kunming Wanbao Jiyuan Biotechnology.
7.4 billion (unprovided amount 2).
540,000 yuan, accounting for the proportion of accounts receivable in the mid-term report in 2019.
8%).
According to the 2019 Interim Report, accounts receivable in the joint venture Liangshan Mining2.
2 billion receivables, with an accounting period of less than one year, and reduced parent company control, and the risk of bad debts is small; the remaining unaccounted for bad debts with an age of more than 5 years is zero.
4.1 billion.
The remaining accounts receivable of about 100 million pounds are needed for the company’s daily operations. Under the company’s strategy of strictly controlling the addition of new accounts receivable, the risk of error occurs; the completion of this provision will help improve theThe quality of the company’s accounts receivable substantially absorbed the historical burden.
In 2020, the company’s production capacity of mineral copper and smelted copper is expected to reach full capacity, and the production and sales of major products are expected to reach a new high.
In terms of copper minerals, Pulang Copper Mine is expected to reach full production in 2020, and the output of copper metal rights and interests will continue to increase; in terms of copper smelting, the company’s halogen copper output will exceed 100 tons for the first time in 2019.Technological transformation has been implemented, and the company’s copper phosphate output is expected to reach full production.
Listed companies and groups have abundant resource reserves. The actual controller, Chinalco, has continuously improved its strength, and the company has great potential for resources.
First, the copper resources of listed companies are 513.
47 Absolutely, there are sufficient reserves of mineral rights and reserves of added value.
As of mid-2019, the company maintained a copper resource reserve of 513 and above 333.
47 for the first time, gold 74.
43 tons.
In the future, the company’s sanctions will continue to carry out geological surveys of deep mines of production mines.
In the Dongchuan Copper Mine, key mining areas such as the Pulang Copper Mine and the Yangla Copper Mine have intensified their deep-side exploration and obtained resource reserves; they will gradually continue to develop mining companies and mine resource acquisitions.
According to the company’s announcement, actively seeking domestic and foreign high-quality resource projects to ensure that the increase in resource reserves meets the needs of sustainable development of enterprises.
Second, it is expected that Yunnan Copper Group, the direct controlling shareholder, has the potential to inject resources.
First, as of the end of 2017, the Group has 21 mines in production and 2 mines under construction in Yunnan, Sichuan, Qinghai, Tibet and other regions. The reserve of resources (metal) is 870 copper, of which the listed company’s resource reserve is about 510., Listed companies have 360 initial resources in vitro.
Second, the company is expected to continue to receive support from Chinalco Group.
According to the company’s announcement, the company, as one of the core companies of the Chinalco Group’s copper industry sector, is also the only listed platform company in the copper industry sector, benefiting from Chinalco’s extensive business resources and a small number of project cooperation, resource expansion and stability with major banksPreferential credit relationships, the company continues to receive the support of Chinalco Group in terms of business, resources and finance.
In addition, according to the “China Aluminum Group Co., Ltd. Prospectus for the Third Phase of Ultra-short-term Financing Bonds in 2019”, Chinalco owns the core assets of the Toromocho copper mine.
The mine is located in the core area of the Morococa mining area in central Peru, with a copper grade of 0.
46%, Mo grade 0.
02%, silver grade 6.
89 grams / ton, the mine has copper equivalent metal resources of about 1,200 tons, is one of the world’s largest copper mines, and its copper resources account for about 19% of the total domestic copper resources.
In 2016, the Toromocho copper mine produced copper-containing concentrates16.
83 years, 2017 production of copper-containing concentrates19.
34 Initial.
In June 2018, the second-phase project of the mine is planned to invest 1.3 billion US dollars for expansion. After the expansion, the annual output of copper concentrate will increase to 30 tons.
2019?In 2021, the global supply of copper ore is tight overall. Considering the solid cost support, the inventory consumption ratio is at an extremely low historical level, the margin of demand is picking up, and the copper price has reached a significant rebound.
Our estimates indicate that 2019?
The global copper supply and demand balance will be 10 in 2021.
8, -10.
In terms of 2, 16.
2Baseline, showing a tight balance overall, especially 2019?
In 2020, the copper supply and demand gap will continue to expand.
The current copper price has fallen to the 90th line of the global marginal cost curve, with solid cost support. The inventory consumption ratio of global copper exchanges has changed to a historically low position. Domestic bonded zones and social stocks have replaced lows in the past four years. Copper prices are sensitive to marginal changes in supply and demand.Sexuality has been systematically enhanced.
On this basis, taking into account the current general trend of global monetary easing, the China-US trade agreement has been reached gradually, and the internal counter-cyclical easing policy has gradually come into effect. The short-term economic panic and the gradual escape from substantial relief will be added, and the next spring will be supplemented. The copper price is expected to increase.Ushered in a significant rebound.
Investment suggestion: Give “Buy-A” rating with 6-month target price of 16 yuan.
We follow the copper price for 2019-2021.
80,000 yuan, 5.
20,000 yuan, 5.
The calculation is based on the assumption of 20,000 yuan. After considering the impairment of assets in 2019, the company will gradually realize its net profit attributable to its mother6.
100 million, 9.
300 million and 11.
0 million, EPS is expected to be 0.
36 yuan, 0.
54 yuan and 0.
65 yuan.
As the company’s copper concentrates and smelting copper capacity reach full production, the company’s output has increased significantly, and the performance elasticity of copper prices has increased. In addition, the controlling shareholder’s interests can be injected into the asset potential to enjoy a certain estimated premium.
The company is given a “Buy-A” rating with a six-month target price of 16 yuan, which is equivalent to a 30x dynamic price-earnings ratio in 2020.
Risk reminders: 1) The global economic growth rate exceeds expectations; 2) Global copper mine output exceeds expectations, and the copper supply disruption rate exceeds expectations; 3 The company’s product output is lower than expected, and subsequent mine injections are lower than expected.