Core Viewpoint - The coal industry has made significant strides in high-quality development since the "14th Five-Year Plan," focusing on energy security, green low-carbon transformation, and enhancing industrial competitiveness. Group 1: Supply and Production Capacity - The coal supply capacity has significantly improved, with national coal reserves increasing to 2,186 billion tons by the end of 2023, and coal production capacity continuing to enhance with modernized and intelligent coal mines [2] - National coal production is projected to reach 4.78 billion tons in 2024, an increase of 880 million tons compared to 2020, with cumulative production over four years amounting to 18.18 billion tons, accounting for 66.6% of the total primary energy production [2] - The coal transportation network has expanded, with coal railway shipments increasing from 2.36 billion tons to 2.82 billion tons, enhancing the national coal resource allocation capacity [2] Group 2: Production Distribution and Optimization - The focus of coal production has shifted towards the central and western regions, with raw coal production in the western region increasing from 2.32 billion tons to 3.04 billion tons, raising its national share by 4.2 percentage points [2] - In 2024, eight provinces with over one billion tons of raw coal production are expected to produce 4.36 billion tons, representing 91.3% of the national total, an increase of 860 million tons since 2020 [2] Group 3: Industry Structure and Modernization - The coal industry has optimized its structure, reducing the number of coal mines to under 4,300, with an average production capacity of around 1.7 million tons per mine [3] - The number of large modern coal mines with an annual output of over 1.2 million tons has increased, contributing to a total capacity of 1.36 billion tons per year, up by 540 million tons since 2020 [3] Group 4: Clean and Efficient Utilization - The coal industry has made progress in green low-carbon development, with comprehensive utilization rates for coal gangue and mine water reaching 74.1% and 74.2%, respectively [4] - The comprehensive energy consumption for coal production has decreased to 7.9 kg of standard coal per ton, and the comprehensive electricity consumption has dropped to 23.7 kWh per ton [4] Group 5: Technological Innovation and Development - The coal industry has accelerated technological innovation, with intelligent coal mines accounting for over 55% of total coal production capacity [6] - The industry has seen a significant increase in R&D investment and patent applications, with major technological advancements in deep coal resource extraction and clean conversion technologies [6] Group 6: Industry Reform and Safety - The coal industry is undergoing significant reforms, enhancing market competitiveness and stability, with 26 coal companies listed in the top 500 Chinese enterprises and 6 in the Fortune Global 500 [7] - Safety production capabilities have improved, with a focus on modernizing safety management systems and enhancing disaster prevention measures [8] Group 7: Future Outlook - The coal industry is expected to reach a peak demand plateau during the "15th Five-Year Plan," emphasizing the need for further green low-carbon transformation and ensuring energy security [9]

Investment Rating - The report maintains an "Overweight" rating for the coal mining industry [5] Core Viewpoints - The report emphasizes that the performance pressure on coal companies has ended, and a recovery is expected, not just a rebound [3][8] - It anticipates that coal prices may peak by the end of the year, with a potential for upward movement due to supply constraints [3][8] Summary by Sections Market Overview - The CITIC Coal Index was at 3,459.14 points, up 0.10%, outperforming the CSI 300 Index by 0.91 percentage points [2][76] - Recent coal price trends show a slight recovery, with the price of Q5500 coal in major production areas experiencing increases [14][39] Financial Analysis of Coal Companies - The report identifies top performers in terms of cash flow and low debt levels among coal companies, highlighting companies like China Shenhua and Jinko Coal [3] - The report notes that the profitability of coal companies is likely to improve following the price lows observed in June [3] Key Areas of Analysis - **Thermal Coal**: The report indicates a rebound in thermal coal prices due to downstream demand for replenishment, with prices expected to rise during peak seasons [14][39] - **Coking Coal**: The report notes that coking coal prices are under pressure due to weak downstream demand, but there is still support for prices as the peak season approaches [41][55] - **Coke**: The report highlights that coke prices have seen a decline due to reduced demand from steel mills, with the first round of price reductions initiated by steel manufacturers [57][76] Investment Strategy - The report recommends stocks with high earnings elasticity, such as Lu'an Mining and Jinko Coal, and emphasizes the importance of monitoring domestic supply and import conditions [11][41] - It also suggests focusing on companies with strong performance records, such as Shaanxi Coal and Electric Power, and Huai Bei Mining [11][41]