Investment Rating - The investment rating for the company is "Buy" [6] Core Views - The company has significantly improved its balance sheet, marking a transformation phase. In 2024, the company achieved a revenue of 2.601 billion, a year-on-year decrease of 24.8%, while net profit reached 502 million, reflecting a substantial increase of 150.5% primarily due to a major gain from loan restructuring amounting to 476 million [1][4] - The company is expanding its coal production capacity in Indonesia, which is expected to enhance profitability as the quality of coal from the SDE mine improves [2][3] - The management has shown commitment to shareholder returns by proposing a special dividend of 0.02 HKD per share for 2024, indicating confidence in future profitability [4] Financial Performance Summary - In 2024, the company’s financial costs decreased to 162 million, down 5.9% year-on-year. The current liabilities are projected to reduce to 2.09 billion from 3.32 billion in 2023, with cash reserves increasing to 1.03 billion, primarily from the sale of a 40% stake in Liyuan Development [4] - The company’s debt-to-asset ratio is expected to drop to 59.6% by the end of 2024, down from 95.9% in 2023, indicating a healthier financial position [4] - The company’s coal production in 2024 is projected at 9.29 million tons, a year-on-year increase of 21.5%, with the SDE mine contributing 2.57 million tons [8] Future Projections - The company anticipates net profits of 560 million, 1.04 billion, and 1.54 billion for 2025, 2026, and 2027 respectively, with corresponding P/E ratios of 4.2X, 2.3X, and 1.5X [4][5] - The SDE coal mine is expected to surpass domestic production by 2025, becoming a key pillar of the company's coal business, with total reserves of 305 million tons [8] - The company has successfully acquired 70% stakes in three additional Indonesian coal mines, further expanding its market presence [8]
中国秦发：资产负债表大幅改善，开启蜕变-20250326