Investment Rating - The report maintains a "Buy" rating for China Qinfa [2][4]. Core Views - The completion of a significant equity sale is expected to improve the company's balance sheet and reduce financial costs, potentially enhancing annual profits and laying the groundwork for future expansion in Indonesia [2]. - The company has successfully completed the sale of a 40% stake in a subsidiary, resulting in a net gain of approximately 2.8 billion RMB, with 64% allocated for debt repayment [2]. - China Qinfa's coal mining project in Indonesia is progressing, with a designed capacity of 10 million tons per year and expected to enter trial production by the end of 2023 [2]. - The company benefits from favorable tax conditions in Indonesia, with a lower royalty rate compared to competitors, enhancing its competitive position [2]. Financial Summary - Revenue is projected to recover from a decline, with estimates of 3.56 billion RMB in 2024, growing to 9.35 billion RMB by 2026, reflecting a growth rate of 87% in 2025 [3][10]. - The net profit attributable to shareholders is expected to rise significantly from 175 million RMB in 2024 to 1.24 billion RMB in 2026, indicating a growth rate of 314% in 2025 [3][10]. - The company's P/E ratio is projected to improve from 19.82 in 2024 to 2.81 in 2026, suggesting a strong recovery in profitability [3][10]. Operational Highlights - The company holds a 75% stake in the SDE coal mine in Indonesia, which has high-quality coal resources with a calorific value of 4450-4500 kcal/kg and an estimated resource volume of 293-589 million tons [2]. - Domestic coal production capacity is stable at 5.1 million tons per year, with a focus on mid-to-high calorific value thermal coal [2].
中国秦发：交割落地，困境反转，未来可期