HUAYOU COBALT(SH:603799) Soochow Securities·2024-07-10 03:30Investment Rating - The report maintains a "Buy" rating for the company [1] Core Views - The company has released a performance forecast for H1 2024, exceeding market expectations with a projected net profit attributable to shareholders of 1.5-1.8 billion yuan, a year-on-year decrease of 14%-28% [3] - The significant increase in nickel prices has led to better-than-expected profitability, with Q2 net profit forecasted at 980-1,280 million yuan, showing a year-on-year change of -8% to +20% and a quarter-on-quarter increase of 87% to 145% [3] - The company's integrated advantages are highlighted, with a target price set at 31.2 yuan based on a 15x PE for 2024 [4] Summary by Sections Revenue and Profit Forecast - Total revenue is projected to grow from 66,304 million yuan in 2023 to 70,624 million yuan in 2024, reflecting a year-on-year growth of 6.52% [2] - Net profit attributable to shareholders is expected to increase from 3,351 million yuan in 2023 to 3,529 million yuan in 2024, representing a growth of 5.32% [2] Production and Sales - The company anticipates a significant increase in precursor shipments, with Q2 shipments expected to exceed 30,000 tons, a quarter-on-quarter increase of over 50% [3] - Nickel intermediate shipments are projected at 80,000 to 90,000 tons for H1 2024, with the Huafei project contributing significantly to production [3] Nickel and Copper Business - The report estimates that the company will achieve a net profit contribution of 25-30 billion yuan from nickel refining in 2024, driven by high nickel prices [3] - Copper product shipments are expected to reach around 25,000 tons in Q2, contributing over 200 million yuan in profit [4] Lithium and Cobalt Projects - The Arcadia lithium project is expected to reduce costs significantly, with H1 shipments projected at 18,000 tons, maintaining a breakeven profit [4] - Cobalt product shipments are expected to exceed 10,000 tons in Q2, with self-owned mines contributing to profitability [4] Financial Metrics - The company’s projected earnings per share (EPS) for 2024 is 2.08 yuan, with a price-to-earnings (P/E) ratio of 10.31 [2] - The report forecasts a net profit of 35 billion yuan for 2024, with a corresponding P/E of 10x [4]