Investment Rating - The industry investment rating is "Maintain Buy" for coal mining companies [4][6]. Core Viewpoints - The current coal price adjustment has been ongoing for nearly four years since the historical peak in Q4 2021, and the market is well aware of the price decline. The industry is at a critical stage of price bottoming, and the bottom may not be far off. It is essential to grasp the intrinsic attributes of the industry and maintain confidence [3]. - In May 2025, India's coal-fired power generation decreased by 9.5% year-on-year to 113.3 billion kWh, marking the largest year-on-year decline since June 2020 [2]. - The report emphasizes that domestic coal companies are increasingly facing losses, with over half (54.8%) of coal enterprises reporting losses as of March 2025. This trend may lead to increased probabilities of both passive and active production cuts [3]. Summary by Sections Coal Prices - As of June 6, 2025, coal prices showed mixed trends: European ARA port coal price at $89/ton (down 2.2%), Newcastle port coal price at $218.9/ton (unchanged), and IPE South Africa Richards Bay coal futures at $91/ton (up 1.2%) [1][32]. Key Recommendations - Recommended stocks include: - China Shenhua (601088.SH) - Buy - Shaanxi Coal and Energy (601225.SH) - Buy - China Qinfa (00866.HK) - Buy - China Coal Energy (601898.SH) - Buy - Electric Power Energy (002128.SZ) - Buy - Jinko Coal Industry (601001.SH) - Buy - Yancoal Energy (600188.SH) - Buy - New Hope Energy (601918.SH) - Buy [6]. Electricity Demand - In May 2025, India's total electricity generation decreased by 5.3% year-on-year to 160.4 billion kWh, with peak demand down 8% to 231,000 MW, primarily due to mild weather conditions [5].

Core Viewpoint - China Qinfa Group announced the conditional sale of its wholly-owned subsidiary, Perpetual Goodluck Limited, to Tianhe Group Limited for RMB 30 million, aiming to restructure its business and focus on higher growth opportunities in the coal industry, particularly in Indonesia [1][4][5]. Company Summary - Perpetual Goodluck Limited is a wholly-owned subsidiary of China Qinfa Group, primarily engaged in coal business in China, with significant assets including five coal mines in Shanxi province [4][5]. - The financial performance of the subsidiary has significantly declined over the past three years, with revenues and gross profits dropping due to a decrease in average coal prices from RMB 838 per ton in 2022 to RMB 504 per ton in 2024 [4][14]. - For the fiscal year ending December 31, 2023, the subsidiary reported a post-tax loss of RMB 81.855 million, while it is projected to report a post-tax profit of RMB 499.664 million for the fiscal year ending December 31, 2024 [4][5]. Industry Context - The coal industry in China is facing challenges such as stricter environmental regulations and increased market competition, which may limit profitability in domestic coal operations [14]. - China Qinfa Group has been actively seeking acquisition opportunities to expand its resource reserves and enhance coal production capacity, particularly in Indonesia, where it has successfully acquired operating licenses for three coal mines [13][14]. - The decision to divest from Perpetual Goodluck Limited is part of a strategy to optimize asset structure and concentrate resources on more profitable ventures in the Indonesian coal market [15].

Market Overview - Major technology stocks mostly rose, with Meituan up 3%, Tencent Holdings, Kuaishou, Baidu, and NetEase rising over 1%, while Alibaba, Xiaomi, and JD.com also saw slight increases [1][3] - Nuclear power stocks surged, with CGN Mining up over 28% [1][7] - The innovative drug sector experienced strong growth, with Innovent Biologics rising over 14% [1][8] - Chinese brokerage stocks were active, with Zhongtai Futures up 6% [1][9] - Tobacco stocks, biomedicine stocks, rare earth concept stocks, military industry stocks, and coal stocks all saw increases [1] Individual Stock Highlights - Consumer stocks such as Mixue Group, Pop Mart, and Laopu Gold reached new highs [2] - CGN Mining's stock price reached 2.130, reflecting a 28.31% increase [7] - Innovent Biologics' stock price reached 74.250, reflecting a 14.14% increase [8] - Zhongtai Futures' stock price reached 0.530, reflecting a 6.00% increase [10] Sector Performance - Water utility stocks fell, with China Water Affairs Group down over 15% [1][16] - Telecom stocks declined, with China Unicom down over 2% [1][18] - Coal stocks generally rose, with China Qinfa up over 4% [12][13] - Automotive stocks increased, with Geely Auto and Xpeng Motors both rising over 2% [14][15] Regulatory and Market News - The electronic cigarette regulatory framework in China has been upgraded, which is expected to benefit compliant companies [5] - Meta signed a 20-year contract to purchase nuclear power from Constellation Energy, indicating a rising demand for energy in the tech sector [7] - The 2025 Lujiazui Forum will be held in Shanghai, where significant financial policies will be announced [10][11] - The Ministry of Industry and Information Technology announced a campaign for 2025 to promote new energy vehicles in rural areas [14] Market Sentiment and Outlook - The Hang Seng Index and its sub-indices showed positive performance, with the Hang Seng Technology Index rising by 0.57% [6] - Despite short-term concerns regarding market fundamentals and capital flows, a cautious optimism is maintained for the mid-term market outlook [26]

Investment Rating - The industry investment rating is "Maintain Buy" [5] Core Viewpoints - Indonesia's coal production is expected to decline in 2025 due to weak demand from major buyers like China and India. The production target set by the government of 735 million tons may still be achievable, but reaching the historical high of 835 million tons in 2024 is nearly impossible. In Q1 2025, Indonesia's coal production was only 172 million tons, with exports down 3.88% year-on-year to 126 million tons, resulting in a revenue drop of 16.86% to $7.799 billion [2][3] - The current coal price adjustment has been ongoing for nearly four years since the historical peak in Q4 2021. The market is now aware of the price decline, and it is believed that the bottom of the price cycle is near. Investors are encouraged to maintain confidence and focus on the fundamental attributes of the industry [2] - Domestic coal companies are facing increasing losses, with over half (54.8%) reporting losses as of March 2025. This trend may lead to both passive and active production cuts as prices continue to decline [3] Summary by Sections Coal Mining - Indonesia's coal production is projected to be difficult to reach 800 million tons in 2025 due to weak demand from major buyers [2] - In Q1 2025, coal production was 172 million tons, with exports down 3.88% year-on-year [2] - The domestic coal supply has significantly decreased, with a 25% drop in DMO coal supply compared to the previous year [2] Investment Recommendations - Recommended stocks include China Shenhua (H+A), China Coal Energy (H+A), and China Qinfa, among others. The report emphasizes the importance of performance in stock selection [3][7] Price Trends - Coal prices at Newcastle port (6000K) are stable at $218.9 per ton, while South African Richards Bay coal futures are at $88.40 per ton, and European ARA port coal prices are at $91.00 per ton [2][34]

Investment Rating - The industry investment rating is maintained as "Add" [2] Core Insights - The report highlights that the coal price adjustment has been ongoing since Q4 2021, with the market now recognizing the prolonged decline. It suggests that the bottom of the price cycle may be near, urging stakeholders to maintain confidence and focus on the industry's fundamental attributes [6][7] - The report emphasizes the challenges faced by the Russian coal industry, including rising production costs, declining investment, and logistical issues due to sanctions, which have led to a decrease in coal exports [4][5] - The global metallurgical coal market is experiencing a shift, with supply tightening due to disruptions in Australian coal supply, leading to increased prices for high-quality coking coal [5][6] Summary by Sections Coal Mining - As of May 23, 2025, Brent crude oil futures settled at $64.78 per barrel, down $0.63 (-0.96%) from the previous week, while WTI crude oil futures settled at $61.53 per barrel, down $0.96 (-1.54%) [1] - The report notes that the price of coal at Newcastle port (6000K) is $218.9 per ton, unchanged from the previous week, while the price at the European ARA port is $91 per ton, also unchanged [1][38] Production and Demand - Russia's coal production remains around 440 million tons annually, with coking coal production at approximately 110 million tons. Domestic demand for coal in Russia is projected to grow by 13.13% year-on-year in 2024, reaching 205 million tons [4] - The report indicates that the share of electricity coal demand in Russia is about 46% [4] Investment Recommendations - The report recommends several coal companies for investment, including China Shenhua (H+A), China Coal Energy (H+A), and others, highlighting their performance and potential for recovery [6][7] - The report suggests that the domestic coal companies are facing increasing losses, with over 54.8% of coal enterprises reporting losses as of March 2025, indicating a higher likelihood of production cuts [6][7] Market Outlook - The report anticipates that by 2050, global metallurgical coal demand will decrease from 1.099 billion tons in 2024 to 885 million tons, with significant shifts in demand from China to India [5] - It is projected that the price of high-quality Australian coking coal will gradually rise due to long-term structural shortages [5]

Investment Rating - The industry investment rating is maintained as "Increase" [6] Core Viewpoints - The coal mining industry is expected to see improved demand as effective supply decreases, presenting a good investment opportunity since the beginning of the year [1] - In April 2025, the raw coal production decreased by 50 million tons month-on-month, with an annual growth rate of 3.8% [1][12] - The forecast for 2025 indicates a net increase in production of only 55-60 million tons, with a year-on-year growth rate of approximately 1.2-1.3%, continuing to slow down compared to 2024 [1][12] Summary by Sections Production - In April 2025, the raw coal production was 390 million tons, with a year-on-year increase of 3.8% [1][12] - The average daily production in April was 12.98 million tons [1][12] Import - In April 2025, coal imports were 37.83 million tons, a decrease of 16.41% year-on-year [2][16] - For the first four months of 2025, total coal imports were 152.67 million tons, down 5.3% year-on-year [2][16] - The forecast for 2025 suggests that thermal coal imports may stabilize or decline slightly, with an expected total of around 385 million tons, a year-on-year decrease of 4.9% [2][16] Demand - In April 2025, the industrial power generation was 711.1 billion kWh, with a year-on-year growth of 0.9% [3][19] - The industrial thermal power generation decreased by 2.3% year-on-year, remaining stable compared to March [3][19] - The growth rates for wind and solar power generation increased to 12.7% and 16.7% respectively in April [3][19] Investment Recommendations - Key recommendations include major coal enterprises such as China Shenhua (H+A), China Coal Energy (H+A), and turnaround opportunities like China Qinfa [5][37] - Other recommended stocks include new energy companies with strong performance such as Xinjie Energy, Shaanxi Coal, and Electric Power Energy [5][37] - Companies with potential for future growth include Huayang Co. and Gansu Energy [5][37]

Investment Rating - The industry investment rating is "Maintain Buy" [6] Core Viewpoints - The coal mining industry is expected to see improved demand and effective supply reduction, presenting a good investment opportunity since the beginning of the year [1] - In April 2025, the raw coal production decreased by 50 million tons month-on-month, with a total output of 390 million tons, reflecting a year-on-year growth of 3.8% [12][13] - The report anticipates a net increase in coal production of only 55 to 60 million tons in 2025, representing a year-on-year growth of approximately 1.2% to 1.3%, indicating a continued slowdown compared to 2024 [1][12] Production Summary - In April 2025, the raw coal production was 390 million tons, with a daily average of 12.98 million tons [12][13] - The cumulative raw coal production from January to April 2025 reached 1.58 billion tons, showing a year-on-year increase of 6.6% [12] Import Summary - In April 2025, coal imports were 37.83 million tons, a decrease of 16.41% year-on-year and a 2.34% decrease month-on-month [2][16] - From January to April 2025, total coal imports amounted to 152.67 million tons, down 5.3% year-on-year [16] - The report forecasts that the total annual coal imports for 2025 may be around 385 million tons, reflecting a year-on-year decline of 4.9% [2][16] Demand Summary - In April 2025, the industrial power generation was 711.1 billion kWh, with a year-on-year growth of 0.9% [3][19] - The industrial thermal power generation saw a year-on-year decline of 2.3%, remaining consistent with the previous month [3][19] - Renewable energy sources such as wind and solar power showed significant growth, with wind power increasing by 12.7% and solar power by 16.7% year-on-year [3][19][32] Investment Recommendations - Key recommended stocks include China Shenhua (H+A), China Coal Energy (H+A), and China Qinfa, among others [5][37] - The report emphasizes the importance of performance in stock selection, highlighting companies like Xinjie Energy and Shaanxi Coal and Chemical Industry [5][37]

Investment Rating - The report maintains an "Overweight" rating for the coal mining industry [4][7]. Core Insights - The coal price adjustment has been ongoing for nearly four years since the historical peak in Q4 2021, with prices generally returning to levels before the recent uptrend. The market is now aware of the price decline, indicating that the bottom may be near. It is essential to understand the industry's fundamental attributes and maintain confidence and determination [3]. - As of April 2025, Australian coal exports totaled 104 million tons, a year-on-year decrease of 8.1%. In April alone, exports were 26.53 million tons, down 3.7% year-on-year and 12.3% month-on-month [2][6]. - Domestic coal companies are increasingly facing losses, with over half (54.8%) reporting losses as of March 2025. This trend may lead to both passive and active production cuts as prices continue to decline [3]. Summary by Sections Coal Mining Exports - In the first four months of 2025, Australian coal exports decreased by 8.1% year-on-year, totaling 104 million tons. April's exports were 26.53 million tons, reflecting a 3.7% year-on-year decline and a 12.3% month-on-month decline [2][6]. Price Trends - As of May 16, 2025, coal prices showed mixed trends: Newcastle port coal (6000K) was priced at $99.0 per ton (up 0.1), while European ARA port coal was at $94.5 per ton (down 2.6) [35]. The IPE South African Richards Bay coal futures settled at $87.60 per ton (down 1.4) [35]. Recommended Stocks - The report recommends several coal companies, including: - China Shenhua (601088.SH) - Buy - Shaanxi Coal (601225.SH) - Buy - China Qinfa (00866.HK) - Buy - China Coal Energy (601898.SH) - Buy - Electric Power Energy (002128.SZ) - Buy - Jinneng Holding (601001.SH) - Buy - Yancoal (600188.SH) - Buy - New Hope Energy (601918.SH) - Buy [7].

Investment Rating - The report maintains an "Overweight" rating for the coal mining industry [4]. Core Viewpoints - The current coal price adjustment has been ongoing for nearly four years since the historical peak in Q4 2021, with prices generally returning to pre-increase levels. The market is well aware of the price decline, indicating that the bottom may be near. It is essential to understand the industry's fundamental attributes and maintain confidence and determination [3]. - As of April 2025, Australian coal exports totaled 104 million tons, a year-on-year decrease of 8.1%. The decline in exports is attributed to the shutdown of Australian coking coal production, which has led to rising prices [2][6]. - Domestic coal companies are increasingly facing losses, with over half (54.8%) reporting losses as of March 2025. This trend may lead to both passive and active production cuts as prices continue to decline [3]. Summary by Sections Coal Mining Exports - In the first four months of 2025, Australian coal exports decreased by 8.1% year-on-year, totaling 104 million tons. In April alone, exports were 26.53 million tons, down 3.7% year-on-year and 12.3% month-on-month [2]. Price Trends - As of May 16, 2025, coal prices showed mixed trends: Newcastle coal (6000K) was priced at $99.0 per ton (up 0.1%), while European ARA coal was at $94.5 per ton (down 2.6%) [3][35]. The report indicates that the coal price adjustment is nearing its end, with potential for recovery as production cuts may occur due to high overseas mining costs [3]. Recommended Stocks - The report recommends several coal companies, including China Shenhua (601088.SH), Shaanxi Coal (601225.SH), and China Qinfa (00866.HK), all rated as "Buy." Other recommended stocks include China Coal Energy (601898.SH) and Xinjie Energy (601918.SH) [7]. Market Outlook - The report suggests that the coal industry is at a critical stage of price exploration, with the potential for a rebound as the market adjusts to production cuts and changing demand dynamics [3].

Investment Rating - The report maintains an "Overweight" rating for the coal mining industry [4]. Core Viewpoints - The current phase of coal price adjustment is nearing its end, with the market having a clear understanding of the price decline. The industry is at a critical stage of price bottoming, and confidence should be maintained [3]. - The global seaborne coal trade volume decreased by 6.7% year-on-year in Q1 2025, with significant declines in coal exports from major countries [2][6]. - Domestic coal companies are facing increasing losses, with over half (54.8%) reporting losses as of March 2025, leading to a higher probability of production cuts [6]. Summary by Sections Coal Mining Trade - In Q1 2025, the international seaborne coal trade volume was 307 million tons, down 6.7% year-on-year [2]. - Major exporting countries saw declines: Indonesia's exports fell by 10.7% to 114.5 million tons, Australia by 9.4% to 76.6 million tons, and the U.S. by 4.9% to 20.8 million tons [6]. Price Trends - As of May 9, 2025, coal prices showed slight increases: European ARA port coal at $97.1/ton (+1.9%), Newcastle port coal at $98.9/ton (+0.9%), while South African Richards Bay coal futures fell slightly to $89.0/ton (-0.1%) [1][37]. - The report indicates that coal prices are stabilizing after a prolonged decline since Q4 2021 [3]. Recommendations - The report recommends increasing positions in key coal companies such as China Shenhua, China Coal Energy, and others, highlighting their potential for recovery and performance [6][7].