Huachuang Securities·2024-10-09 23:38Investment Rating - The report maintains a "Recommended" investment rating for Zijin Mining [2][4]. Core Views - Zijin Mining is acquiring the Akyem gold mine in Ghana for $1 billion, which is expected to enhance its gold resource portfolio significantly [2]. - The Akyem mine has proven, controlled, and inferred gold resources of 54.4 tons with a grade of 3.36 grams per ton, and a total gold reserve of 34.6 tons with a grade of 1.35 grams per ton [2]. - The acquisition is projected to help Zijin Mining achieve its future gold production targets, with the Akyem mine averaging gold production of 11.4 tons over the past three years [2]. - The expected net profit for Zijin Mining is forecasted to grow significantly, with estimates of CNY 318.3 billion, CNY 371.6 billion, and CNY 448.2 billion for 2024, 2025, and 2026 respectively, reflecting year-on-year growth rates of 50.7%, 16.8%, and 20.6% [2][5]. Summary by Sections Acquisition Details - Zijin Mining's wholly-owned subsidiary plans to invest $1 billion to acquire 100% equity of the Akyem gold mine from Newmont [2]. - The payment structure includes an initial payment of $900 million at closing and a remaining $100 million contingent on certain approvals [2]. Financial Projections - Total revenue for Zijin Mining is projected to reach CNY 346.8 billion in 2024, with a year-on-year growth rate of 18.2% [5]. - The company expects to achieve a net profit of CNY 31.8 billion in 2024, representing a 50.7% increase from the previous year [5]. - Earnings per share (EPS) are forecasted to increase from CNY 0.79 in 2023 to CNY 1.20 in 2024 [5]. Market Position - The Akyem mine is one of the largest gold mines in Ghana, located in a major gold-producing region, which enhances its resource development potential [2]. - The acquisition marks Zijin Mining's first foray into the Ghanaian mineral resource market, diversifying its operational footprint [2].