SDR(000603) 德邦证券·2024-12-10 12:33Investment Rating - The report gives a "Buy" rating for the company, marking its first coverage [1]. Core Views - The company is a leading player in the precious metals sector, with a brief underperformance in 2023, but significant improvement is expected in 2024. The main business involves the mining and sales of non-ferrous metal ores, primarily silver ingots, gold, and silver-containing lead and zinc concentrates. The company has seven subsidiaries with substantial silver reserves and mining capacity, positioning it as an industry leader [3][26]. - The prices of gold and silver are expected to continue rising, with gold's intrinsic value projected at 2,572.20 per ounce. The report suggests that silver has greater price elasticity compared to gold due to its industrial demand [4][56]. - The company is undergoing significant operational improvements, including the completion of mining engineering technology upgrades and acquisitions of remaining stakes in subsidiaries, which are anticipated to enhance profitability and operational efficiency [5][66]. Summary by Sections Company Overview - The company primarily engages in the mining and sales of non-ferrous metals, with a focus on silver, gold, and silver-containing lead and zinc concentrates. It has a strong resource base with nearly 10,000 tons of silver reserves and an annual mining capacity of approximately 2 million tons [3][26]. Financial Performance - In 2023, the company reported a net profit of 148 million yuan, a decrease of approximately 59.41% year-on-year. However, for the first three quarters of 2024, the net profit is expected to rebound to 199 million yuan, reflecting a year-on-year growth of 48.73% [3][37]. Market Outlook - The report anticipates a favorable market environment for precious metals, with projections for the company's net profits to reach 360 million yuan, 580 million yuan, and 740 million yuan for the years 2024, 2025, and 2026, respectively [5][66]. Operational Developments - The completion of mining technology upgrades at the company's subsidiaries is expected to significantly enhance production capacity and efficiency. The company plans to acquire the remaining stakes in its subsidiaries, which will further solidify its market position [5][66]. Resource Reserves - The company boasts rich resource reserves, with a focus on silver, lead, and zinc. Its subsidiaries are strategically positioned to leverage high-grade resources, ensuring a robust operational framework for future growth [73].