\u3000\u3000 Tongling Nonferrous Metals Group Co.Ltd(000630) (000630)
The performance in the 21st year is expected to increase by 260.44%, which is in line with market expectations. The company disclosed the performance forecast for 2021 on the evening of January 17. The company expects to realize a net profit attributable to the parent company of RMB 3.12 billion in 2021, an increase of 260.44% over the same period of last year; The non net profit deducted was RMB 2.82 billion, a year-on-year increase of 311.84%. The main reason for the sharp increase in the company’s performance is the rise in the prices of electrolytic copper, sulfuric acid and other products, as well as the continuous rise in copper foil processing fees.
The significant rise in copper prices and copper foil processing fees helped the company’s performance to a record high. In 2021, the price of copper increased significantly. The price at the end of the year was about 70000 / T, an increase of nearly 27% in the whole year; The company’s self-produced copper output is about 57000 tons, the full cost is about 35000 / ton, and the self-produced mine end performance has been significantly improved. In the past 21 years, the copper foil processing fee increased significantly, and the standard foil processing fee was about 27000 yuan / ton; six μ M lithium foil is 45000 yuan / ton; four point five μ M lithium foil processing fee is 50000 yuan / ton. The company’s subsidiary Copper Crown copper foil has a production capacity of about 45000 tons, has made a significant contribution to the performance in 21 years, is approaching the spin off and listing, and is about to land on the science and innovation board.
Benefiting from the sharp rise in the price of sulfuric acid, the profit of the company’s sulfuric acid business surged. Sulfuric acid is an important raw material for chemical fertilizer production. In 2021, China’s demand for chemical fertilizer was strong, the price of sulfuric acid rose sharply, and the highest spot price exceeded 900 yuan / ton. The company uses copper smelting tail gas to prepare sulfuric acid, and the cost is only 150 yuan / ton. Compared with other sulfuric acid production enterprises, the company has obvious cost advantages, and the performance of sulfuric acid sector in 21 years is bright. We expect that the ban on fertilizer export is expected to be lifted in the first quarter. At the same time, the current sulfuric acid inventory is low, and the sulfuric acid price is expected to remain strong.
Mirador copper mine has a smooth production and strong injection expectation. Since it was put into operation, the output of Mirador copper mine has increased steadily. It is expected that the output of copper mine will reach 75000 tons in 2021 and more than 100000 tons in 2022. The injection of Mirador copper mine has been steadily advancing. If Mirador copper mine is successfully injected in the later stage, the company will become a leading enterprise in the copper industry integrating copper mining, copper smelting and copper deep processing.
Investment suggestion: the company integrates copper mining, copper smelting and copper deep processing. With the rise of copper price and copper foil processing fee, the performance may increase steadily. The company’s operating revenue is expected to reach RMB 143138, 149334 and 153.279 billion from 2021 to 2023, with EPS of 0.30, 0.33 and 0.34 respectively. For the first time, give a “buy” rating.
Risk tip: the copper price drops, and the injection progress of Mirador copper mine is less than expected
