SJI(SZ:000975) Dongxing Securities·2024-08-22 02:00Investment Rating - The report maintains a "Recommended" rating for the company [2][8]. Core Views - The company has demonstrated substantial growth in both revenue and profit, with a 42.27% year-on-year increase in revenue to CNY 6.505 billion and a 46.35% increase in net profit attributable to shareholders to CNY 1.075 billion in the first half of 2024 [2][3]. - The company's gold production capacity is expected to continue growing, with projected production reaching 8.6 tons in 2024 and a high probability of achieving the long-term target of 15 tons by 2026 [3][8]. - The company has a strong operational efficiency, reflected in the increase of its gold gross margin to 71.89%, up from 60.76% in the previous year [3][8]. Summary by Sections Financial Performance - In 2024 H1, the company achieved a revenue of CNY 6.505 billion, a 42.27% increase year-on-year, and a net profit of CNY 1.075 billion, marking a 46.35% growth [2][3]. - The basic earnings per share (EPS) rose to CNY 0.387, up 46.33% from the previous year [2][3]. - The gross margin for gold production improved significantly, reaching 71.89%, an increase of 11.37 percentage points [3][8]. Mining Resources and Exploration - The company holds 15 exploration rights covering 175.42 square kilometers, with significant mineral reserves including 156.78 tons of gold and 7856.9 tons of silver [2][3]. - The exploration potential in regions like Daqing and Qinghai is substantial, with ongoing projects expected to enhance the value of mining rights [2][3]. Production and Cost Efficiency - The company's gold production increased to 4.16 tons in 2024 H1, with a production-to-sales ratio of 106% [3][8]. - The cost of gold production has been optimized, with the cost per gram decreasing to CNY 146.53, making it one of the best in the industry [8]. - The company has also seen improvements in the production of silver, lead, and zinc, with respective gross margins of 44.6%, 40.15%, and 40.28% [8]. Future Outlook - The company is expected to achieve revenues of CNY 10.729 billion, CNY 12.512 billion, and CNY 15.420 billion for the years 2024, 2025, and 2026 respectively, with net profits projected to reach CNY 2.177 billion, CNY 2.679 billion, and CNY 3.505 billion [8][9]. - The anticipated EPS for 2024, 2025, and 2026 is CNY 0.78, CNY 0.96, and CNY 1.26 respectively, indicating strong growth potential [8][9].