YCC(SZ:000878) Minsheng Securities·2025-09-30 12:34Investment Rating - The report gives a "Buy" rating for the company, with a recommendation based on its strong market position and upcoming asset injections [3][47]. Core Insights - The company is a leading copper producer in Southwest China, backed by its parent company, China Aluminum Corporation (Chinalco), and is the only publicly listed platform for copper operations in China [3][9]. - The company is set to acquire a 40% stake in Liangshan Mining, which will enhance its resource base and production capacity [3][33]. - The company has experienced stable revenue growth, with a revenue of 889.13 billion yuan in H1 2025, representing a year-on-year increase of 4.27% [19][41]. Summary by Sections Company Overview - The company operates in various sectors including copper exploration, mining, smelting, and the processing of precious and rare metals [9]. - In 2024, the company produced 5.48 million tons of copper concentrate, a decrease of 13.97% year-on-year, and 120.6 million tons of cathode copper, down 12.6% [9][19]. Mining Operations - The core mining asset is the Pulang Copper Mine, which holds 278.22 million tons of copper metal resources, accounting for 77% of the company's total copper resources [2][26]. - The company has a total ore reserve of 956 million tons as of June 2025, with a copper metal content of 3.6137 million tons [2][26]. Smelting Operations - The company has established three major smelting bases in Southwest, Southeast, and Northern China, with a total capacity of 1.4 million tons [29]. - The smelting segment has been impacted by a decline in processing fees, leading to significant profit reductions in its subsidiaries [29][30]. Future Prospects - The acquisition of Liangshan Mining is expected to significantly boost the company's production capacity and profitability, with projected net profits of 17.79 billion yuan, 23.03 billion yuan, and 28.71 billion yuan for 2025-2027 [3][47]. - The company is well-positioned for future growth due to its strong resource base and the anticipated recovery in copper processing fees [3][47].