ZANGGE MINING(000408) 国泰君安·2024-08-11 10:02Investment Rating - Maintain "Overweight" rating [8] - Target price adjusted to 28.78 yuan from 33.75 yuan [8] Core Views - Lithium and potassium prices decline, dragging down company performance [7] - Copper business expansion expected to become a new growth driver [7] - 2024 H1 revenue decreased by 37% YoY to 1.762 billion yuan, with net profit attributable to shareholders down 35.99% YoY to 1.297 billion yuan [8] - Q2 revenue decreased by 19.36% YoY but increased 86.76% QoQ to 1.147 billion yuan, with net profit down 30.56% YoY but up 45.05% QoQ to 768 million yuan [8] Financial Summary - 2024E revenue forecasted at 3.216 billion yuan, a decrease of 38.5% YoY [6] - 2024E net profit attributable to shareholders forecasted at 2.384 billion yuan, a decrease of 30.3% YoY [6] - 2024E EPS adjusted to 1.51 yuan from 1.65 yuan [8] - 2024E PE ratio at 14.68x, with a PB ratio of 2.32x [6] Business Performance - Potassium chloride revenue in 2024 H1 decreased by 32.7% YoY to 1.122 billion yuan, with production and sales volumes at 522,800 tons and 540,100 tons, respectively [8] - Lithium carbonate revenue in 2024 H1 decreased by 43.4% YoY to 634 million yuan, with production and sales volumes at 5,800 tons and 7,600 tons, respectively [8] Project Progress - Mami Cuo Salt Lake project infrastructure construction is progressing, with resource reserves of approximately 2.18 million tons LCE, expected to reach full production by 2027 [8] - Laos potash mine project is advancing, with initial capacity of 1 million tons/year expected to be completed by 2026 [8] Copper Business Expansion - Dragon Copper Mine Phase II expansion project approved, with Phase I and II combined annual copper production expected to reach 300,000-350,000 tons by 2026 [8] - Investment income from Dragon Copper Mine in 2024 H1 reached 855 million yuan, accounting for 65.94% of net profit attributable to shareholders [8] Industry Comparison - Average 2024E PE ratio for lithium industry peers is 13.41x [12] - Zangge Mining's 2024E PE ratio of 14.68x is higher than peers due to lower resource development costs and copper business expansion potential [8]