ZHONGTAI SECURITIES·2025-10-30 07:08Investment Rating - The investment rating for Luoyang Molybdenum (603993.SH) is "Buy" (maintained) [1] Core Views - The report highlights that the company's performance exceeded expectations due to rising prices of key products and increased production and sales of copper products, leading to a significant profit increase [4][6] - The copper production is expected to exceed 700,000 tons annually, with the KFM Phase II project set to enhance production capacity significantly [6][7] - The forecasted net profit for the company is projected to be 18.6 billion, 24.4 billion, and 25.4 billion yuan for the years 2025, 2026, and 2027 respectively, reflecting a strong growth trajectory [6][7] Summary by Sections Financial Performance - For the first three quarters of 2025, the company achieved a revenue of 145.49 billion yuan, a year-on-year decrease of 6.0%, while the net profit attributable to shareholders was 14.28 billion yuan, a year-on-year increase of 72.6% [4] - The third quarter of 2025 alone saw a revenue of 50.71 billion yuan, a decrease of 2.36% year-on-year, but a profit increase of 96.4% year-on-year [4] Production and Pricing - In the first three quarters of 2025, copper production reached 543,400 tons (up 14.14% year-on-year) and sales were 520,300 tons (up 10.56% year-on-year) [6] - The average price of copper on the LME was $9,589 per ton (up 3.66% year-on-year), while the average price on the SHFE was 78,300 yuan per ton (up 4.42% year-on-year) [6] Profitability - The copper segment achieved a gross profit of 20.88 billion yuan, with a gross margin increase from 52.34% to 54.07% [6] - The cobalt segment's gross profit rose to 3.92 billion yuan, with a gross margin increase from 36.49% to 63.46% [6] Future Outlook - The company aims to achieve an annual copper production target of 80,000 to 100,000 tons over the next five years, with significant investments planned for the KFM Phase II project [6][7] - The projected P/E ratios for 2025, 2026, and 2027 are 20, 15, and 15 respectively, indicating a favorable valuation as the company enters a capacity release phase [7]