Core Viewpoint - The tungsten market is experiencing a significant price surge, with prices nearly doubling since the beginning of the year, driven by resource constraints and expanding demand [2][5]. Group 1: Tungsten Price Trends - As of October 28, 2025, the price of black tungsten concentrate (≥65%) reached 288,000 CNY/ton, up 3,000 CNY from the previous trading day, while APT (ammonium paratungstate ≥88.5%) was priced at 425,000 CNY/ton, an increase of 7,000 CNY [5]. - Year-to-date, the price of black tungsten concentrate has increased by approximately 98.76%, from an average of 144,900 CNY/ton at the beginning of the year, while APT has risen by about 99.62% from 212,800 CNY/ton [5]. Group 2: Company Performance and Stock Market Reaction - Following the surge in tungsten prices, the stock price of China Tungsten High-Tech Materials Co., Ltd. (中钨高新) has seen significant increases, with a closing price of 24.76 CNY on October 29, 2025, marking a 10% rise and a total market capitalization of 56.418 billion CNY [2][7]. - The company reported a 13.39% year-on-year increase in revenue for the first three quarters of 2025, totaling 12.755 billion CNY, and an 18.26% increase in net profit, amounting to 846 million CNY [6]. Group 3: Acquisition and Resource Strategy - On October 26, 2025, China Tungsten High-Tech announced plans to acquire a 99.9733% stake in Hunan Yuanjing Tungsten Industry Co., Ltd. for 821 million CNY, which represents a 170.27% premium over the net asset value of approximately 304 million CNY [3][8]. - The acquisition is expected to enhance the company's resource self-sufficiency by approximately 25%, further solidifying its position in the tungsten market amid rising prices and limited supply [11][12]. Group 4: Market Dynamics and Future Outlook - Analysts indicate that the recent price increases are influenced by reduced mining quotas and strong demand in sectors such as new energy, military, and semiconductors, with limited market inventory contributing to rapid price increases [5][6]. - The company is expected to continue benefiting from its comprehensive resource strategy, with ongoing efforts to integrate additional mining assets and enhance operational efficiencies [12].

Group 1 - The core viewpoint is that while the market perceives Tongling Nonferrous Metals as a strong beta stock closely tied to copper price fluctuations, the company has significant growth potential due to its resource side and production capabilities [1] - The company is expected to enhance its copper resource self-sufficiency with the commissioning of the second phase of the Mirador project [1] - On the processing side, the company has established five major copper processing bases, enabling it to produce a variety of copper products and target high-end markets, thus moving towards a high-end product structure [1] Group 2 - The company is given a target price of 6.14 yuan per share based on a 15 times PE ratio for the year 2026 [1] - The initial coverage of the company includes a "buy" rating, indicating positive expectations for its future performance [1]

Investment Rating - The report gives a "Buy" rating for Tongling Nonferrous Metals Group Co., Ltd. with a target price of 6.14 CNY per share based on a 15x PE for 2026 [1][4]. Core Views - The company is expected to see significant growth in its resource self-sufficiency rate due to the production ramp-up of the Mirador Phase II project, enhancing profitability [2][14]. - The processing segment is targeting high-end markets, with a product structure moving towards high-end development, supported by five major copper processing bases [2][67]. Summary by Sections Financial Performance - Revenue is projected to grow from 137.45 billion CNY in 2023 to 182.07 billion CNY in 2027, with a CAGR of approximately 18.7% from 2024 to 2025 [3]. - Net profit is expected to increase from 26.99 billion CNY in 2023 to 57.32 billion CNY in 2027, reflecting a significant growth rate of 54.1% in 2026 [3][13]. Resource Segment - The self-sufficiency rate is expected to rise to 10.3% in 2025, 12.0% in 2026, and 15.4% in 2027, driven by the Mirador Phase II project [10]. - The company produced 176.80 thousand tons of cathode copper in 2024, with a self-sufficiency rate of 8.8%, a notable increase from 2022 [2][49]. Processing Segment - The company has established a comprehensive processing capability for copper materials, including rods, wires, cables, sheets, and foils, with a focus on high-end markets [2][67]. - The production capacity for electronic copper foil is projected to reach 80 thousand tons per year by the end of 2024, with specific capacities for PCB and lithium battery copper foils [2][67]. Valuation and Target Price - The report compares Tongling Nonferrous with peers like Zijin Mining and Luoyang Molybdenum, concluding a target price of 6.14 CNY per share based on a 15x PE for 2026 [17].

Investment Rating - The report downgrades the investment rating to "Cautious Accumulate" from "Accumulate" [1][11] Core Views - The company's performance in 2024 is under pressure due to declining lithium prices and significant impairment provisions, leading to a projected revenue of 45.81 billion yuan, a year-on-year decrease of 42.4% [2][11] - The company is expected to recover as projects like the Muliang Lithium Mine progress, which will enhance resource self-sufficiency and alleviate margin pressure from narrowing smelting price differentials [2][11] Financial Summary - Revenue for 2023 was 7,951 million yuan, projected to drop to 4,581 million yuan in 2024, with a subsequent increase to 4,867 million yuan in 2025 [4] - Net profit attributable to shareholders is expected to shift from a profit of 702 million yuan in 2023 to a loss of 622 million yuan in 2024, with a recovery to 174 million yuan in 2025 [4] - Earnings per share (EPS) is forecasted to be -0.68 yuan in 2024, recovering to 0.19 yuan in 2025 and 0.54 yuan in 2026 [4] Market Data - The current stock price is 13.23 yuan, with a target price maintained at 13.94 yuan [1][5] - The stock has a market capitalization of 12,109 million yuan and a price-to-earnings (P/E) ratio of 17.24 based on the current price [5][4] Project Progress - The company has successfully ramped up production at its Yilonggou lithium concentrate project, achieving a production capacity of 75,000 tons per year, and the Zimbabwe project is also operational [11] - The construction of the Sichuan Muliang Lithium Mine is progressing well, with expectations for production to commence by the end of 2027, potentially reaching an annual capacity of 570,000 tons [11]