HUAYOU COBALT(SH:603799) Soochow Securities·2025-10-20 06:28Investment Rating - The investment rating for Huayou Cobalt (603799) is "Buy" (maintained) [1] Core Views - The report highlights stable nickel profits in Q3 and anticipates significant profit elasticity from rising cobalt prices in the future [7] - The company is expected to achieve a total revenue of 81.86 billion yuan in 2025, with a year-on-year growth of 34.32% [1] - The net profit attributable to shareholders is projected to reach 6.03 billion yuan in 2025, reflecting a year-on-year increase of 45.17% [1] Financial Performance Summary - For the first three quarters of 2025, the company reported revenue of 58.94 billion yuan, up 29.6% year-on-year, and a net profit of 4.22 billion yuan, up 39.6% year-on-year [7] - Q3 2025 revenue was 21.74 billion yuan, with a quarter-on-quarter increase of 40.9% and a year-on-year increase of 12.3% [7] - The gross profit margin for Q3 was 16.7%, slightly down from the previous quarter [7] Nickel and Cobalt Production Insights - Nickel is the main profit contributor, with expected nickel product shipments of 240,000 tons for the year [7] - Cobalt shipments are projected at approximately 35,000 tons for the first three quarters of 2025, with Q3 shipments increasing by 40% [7] - The report anticipates cobalt prices to rise to 400,000 yuan/ton, significantly boosting profit contributions in 2026 [7] Financial Forecasts - The forecast for net profit attributable to shareholders for 2025-2027 is adjusted to 6.0 billion, 9.0 billion, and 10.9 billion yuan respectively, with corresponding P/E ratios of 19x, 13x, and 11x [7] - The target price is set at 95 yuan, based on a 20x P/E for 2026 [7] Cash Flow and Capital Expenditure - Operating cash flow for the first three quarters of 2025 was 4.18 billion yuan, up 8.8% year-on-year [7] - Capital expenditure for the same period was 7.88 billion yuan, reflecting a 53.3% increase year-on-year [7]