收购现有金矿标志着进军黄金领域

Brownfield Gold Mine AcquiredTo Mark Entry Into the Gold Field Huatai Research Company Update 3993 HK603993 CHBUY(Maintain)BUY(Maintain)HKD8.43RMB 10.25 18 May 2025│China (Mainland/HongKong) Basic Metals & Processing China Molybdenum mainly engages in copper and cobalt operations, and we thinka new round of capacity expansions for its two major copper mines should positionthe company to benefit from rising copper prices, while cobalt products offergreater profit upside.Its recent acquisition of a high-quality brownfield gold mine inEcuador marks entry into the goldsegment.Expecting gold prices to continuerising, we anticipate the projectto become another profit growth curve for ChinaMolybdenum should the acquisition and ensuing commissioning be successful.Maintain BUY. AnalystLI BinSAC No. S0570517050001SFC No. BPN269libin@htsc.com+(86) 10 6321 1166 1Q25 attributable NP +90.47% yoy on copper-cobalt volume/profit riseFor 1Q25, revenue/attributable NP came to RMB46,006/3,946mn (-0.25/+90.47% yoy,-21.05/-24.97%qoq). Price wise, for 1Q25, LME copper/cobalt prices wereUSD9,340/25,968per tonne (+10.7/-9.8%yoy,+1.6/+6.9%qoq). This, coupledwith a substantial decline in unit cobalt costs, resulted in copper/cobalt segmentGPM of55.21/61.42%in 1Q25 (+7.14/+24.81pp yoy,+10.7/+34.3pp qoq). Thecompany’scopper/cobaltoutputfor1Q25cameinat170/30ktonnes(+15.6/+20.7%yoy,-2.0/+3.3%qoq). Therefore, for 1Q25, copper-cobalt grossprofit picked up notably in yoy terms; qoq wise, copper gross profit sank byRMB1.9bn qoq to RMB6.86bn due to unfavorable sales conditions, while cobaltgross profit swelled by RMB1.77bn qoq to RMB2.32bn. Proposing to acquire a quality brownfield gold mine in EcuadorOn21April2025, the company announced approval by its investment committee to acquire 100% of Canada-listed Lumina Gold for CAD581mnin cash via anoverseas entity. Lumina holds full ownership of Ecuador's Cangrejos gold project,which features: 1) substantial reserves—638 tonnes of gold resources atanaverage grade of0.46g/tonneand 359 tonnes of reserves atan average grade of0.55g/tonne. The company expectsa 26-year mine life, whereasexploration withinexisting licensesproceeds.2) competitive cost profile(for our estimate), backed bya large-scale, shallow porphyry deposit with open-pit mining, low strip ratio, androbustinfrastructure.Expecting gold prices to continue rising, we anticipate theproject to become another profit growth curve for China Molybdenum should theacquisition and the ensuing development be successful. Source:S&P Maintain BUYGiven the negative impact of tra de frictions on copper prices, we lower our copperprice estimates for 2025/2026/2027, trimming our 2025/2026/2027 attributable NPestimatesby1/12/5%toRMB15.1/16.1/21.1bn.Giventhecompany’sstronggrowth potentialbacked by its clear copper capacity expansion plan and its entryinto the gold field, we value the stock at 14.6x 2025E PE, 35%above its peers’average of 10.8x on Wind consensus, and maintain a 31% A-/H-share premium.OurA-/H-sharetargetpricesareRMB10.25/HKD8.43(previous:RMB10.32/HKD8.53,based on 14.5x 2025E PE). Risks:lowercopperpricesthanweexpect;slowercapacitycommissioning/expansion than we expect. Source:S&P,Huatai Research Source:S&P,Huatai Research Fullfinancials Disclaimers Analyst CertificationI/We, LI Bin, hereby certify that the views expressed in this report accurately reflect the personal views of the analyst(s) aboutthesubject securities or issuers; and no part of the compensation of the analyst(s) was, is, or will be, directly or indirectly,related tothe inclusion of specific recommendations or views in this report. General Disclaimers and DisclosuresThis research report has been prepared by Huatai Financial Holdings (Hong Kong) Limited (hereinafter referred to as “HFHL”). The information herein is strictly confidential to the recipient. This report is intended for HFHL, its clients and associatedcompanies. Any other person shall not be deemed a client of the Company merely from his or her receipt of this report. This report is based on information deemed reliable and publicly available by HFHL, but HFHL and its associated company(ies)(collectively, hereinafter “Huatai”) makes no guarantee as to the accuracy or completeness of such information. The opinions, assessments and projections contained herein only reflect the views and judgments at the issuance date. Huataimay issue research reports that containinconsistent views, assessments and projections with those set out herein at differenttimes. The prices, values and investment returns of the securities or investment instruments referred to herein may fluctuate.Past performance is not a guide to futureperformance, future returns are not guaranteed, and a loss of original capital may occur.Huatai makes no warrants that the information in this report be kept up to date. The information contained in this report maybemodified without notice by Huatai, and investors shall pay attention to suc