Jinduicheng Molybdenum (SH:601958) GF SECURITIES·2024-07-16 02:01Investment Rating - The report maintains a "Buy" rating for the company [5] Core Views - The company benefits from rising molybdenum prices, with significant year-on-year and quarter-on-quarter growth in performance for Q2 2024. Estimated revenues and net profits for Q2 2024 are approximately 3.73 billion and 870 million yuan, respectively, with net profit growth exceeding 30% quarter-on-quarter [2] - The company has a strong track record of high dividend payouts, with cumulative cash dividends of 9 billion yuan since its listing and an average dividend payout ratio of about 75%. The total dividend for 2023 was 1.29 billion yuan, corresponding to a dividend rate of 41.6%, which translates to a dividend yield of 3.6% based on the closing price on July 1, 2024 [2] - Supply constraints in molybdenum are expected to support price stability and growth. Global molybdenum supply is projected to increase by about 2% to 3% from 2024 to 2026, with aging mines posing significant challenges. Estimated global molybdenum production for 2024, 2025, and 2026 is 290,000, 300,000, and 310,000 tons, respectively, reflecting year-on-year growth of 2.1%, 2.4%, and 3.2% [2] - The earnings forecast suggests EPS of 1.13, 1.21, and 1.26 yuan per share for 2024, 2025, and 2026, respectively. The corresponding PE ratios are projected to be 10, 9, and 9 times, compared to a historical average PE of 14.6 times since early 2022. The company's reasonable value is maintained at 14.65 yuan per share, corresponding to a 13 times PE valuation for 2024 [2] Financial Summary - Revenue for 2024 is estimated at 13 billion yuan, with a growth rate of 12.7%. Net profit is projected at 3.635 billion yuan, reflecting a growth rate of 17.3% [4] - The company’s EBITDA is expected to reach 5.447 billion yuan in 2024, with a corresponding PE ratio of 9.63 [4] - The return on equity (ROE) is projected to be 20.9% in 2024, indicating strong profitability [4]