GOLDEN SUN SECURITIES·2025-04-27 14:23Investment Rating - The report maintains a "Buy" rating for key coal companies such as China Shenhua, Shaanxi Coal, and Xinji Energy, while recommending "Overweight" for Pingmei Shenma and Huayang Co. [7][8] Core Viewpoints - The coal mining industry is focusing on cost reduction and efficiency improvement amidst declining coal prices, with companies managing costs to stabilize profits [2][3] - The report indicates that the current coal prices are at a bottom level, suggesting a potential for recovery as domestic policies to stimulate growth and demand are expected to be reinforced [2][3] - The report emphasizes the importance of understanding the fundamental attributes of the industry and maintaining confidence in investment strategies [3] Summary by Sections Market Overview - The CITIC Coal Index was reported at 3,215.97 points, down 0.76%, underperforming the CSI 300 Index by 1.14 percentage points [2][78] - Active funds reduced their holdings in the coal sector, with a decrease of 0.38 percentage points to 0.44% by the end of Q1 2025, marking the lowest level since 2021 [2] Coal Price Trends - As of April 25, 2025, the price of Qinhuangdao Q5500 thermal coal was reported at 665 CNY/ton, a decrease of 9 CNY/ton week-on-week [34] - The report notes that the current market is experiencing a weak demand phase, with power plants showing low procurement activity [34][35] Key Companies and Performance - Yancoal's Q1 2025 comprehensive coal cost was reported at 318 CNY/ton, down 12.9% year-on-year, while China Coal Energy's cost was 270 CNY/ton, down 7.3% [5] - The report highlights the performance of several companies, recommending investments in those showing resilience and potential for recovery, such as China Shenhua and Xinji Energy [7][8] Supply and Demand Dynamics - The report indicates that the supply of thermal coal is currently stable, with minor fluctuations, while demand remains weak, primarily driven by non-electricity sectors [34][35] - The report also discusses the impact of recent policy changes in Indonesia affecting coal export tax rates, which may further influence supply dynamics [5][6] Focus on Coking Coal - The coking coal market is described as weak but stable, with prices under pressure due to cautious market sentiment and high inventory levels [37][55] - The report notes that the average profit per ton of coking coal has improved slightly, indicating a potential for recovery in the sector [55][56]