HUAYOU COBALT(SH:603799) EBSCN·2024-08-22 08:41Investment Rating - The report maintains a "Buy" rating for the company [4][6]. Core Views - The nickel segment's performance is in line with expectations, contributing 57% to the net profit in H1 2024. The company reported a revenue of 30.1 billion yuan, a 10% year-on-year decline, and a net profit of 1.67 billion yuan, down 20% year-on-year [2][3]. - Nickel product shipments reached approximately 76,000 tons in H1 2024, a year-on-year increase of over 40%. The average LME nickel price in H1 was $17,752 per ton, down 27% year-on-year [3]. - The lithium battery materials segment saw a shipment increase of about 11% for precursors and over 20% for cathode materials in Q2 2024 [3]. Summary by Sections Financial Performance - In Q2 2024, the company achieved a net profit of 1.15 billion yuan, an 8% year-on-year increase and a 120% quarter-on-quarter increase. The non-recurring net profit was 1.18 billion yuan, up 40% year-on-year and 109% quarter-on-quarter [2][3]. - The company expects net profits of 3.52 billion yuan and 3.95 billion yuan for 2024 and 2025, respectively, reflecting a downward adjustment of 54% and 64% from previous forecasts [4]. Nickel Segment - The nickel segment's net profit for H1 2024 was 6.9 billion yuan from Huayue Company, 4.7 billion yuan from Indonesia Huake, and 4.5 billion yuan from Indonesia Huafei, totaling 9.5 billion yuan, which accounts for 56.7% of the total net profit [3]. Lithium Battery Materials - The precursor shipment volume was 67,000 tons, with a year-on-year growth of about 11%. The cathode material shipment volume was 53,000 tons, showing a slight decline year-on-year but a significant increase of over 20% quarter-on-quarter in Q2 2024 [3]. Project Developments - The Huafei project has reached full production capacity, contributing incremental profits. The company is also advancing its overseas layout in lithium battery materials, with projects in Indonesia, South Korea, and Hungary [3].