Group 1 - The company held an online performance briefing on September 19, 2025, from 2 PM to 5 PM, via the "Investor Relations Interactive Platform" [1][2] - Key personnel participating in the event included General Manager Chen Weidong, CFO Zheng Lifang, Board Secretary Yang Feng, and Independent Director Huang Weikun [1][2] Group 2 - Investors inquired about the operational status of the company's mines, to which the company confirmed that mining operations are currently normal and advised to refer to periodic reports disclosed on the Giant Tide website [3] - The company addressed the impact of rising tungsten raw material prices on its operating performance, stating that operational conditions should be monitored through periodic reports on the Giant Tide website [3] - The company has not fully explored most areas of the Iron Cangzhai mining area and will develop detailed exploration plans based on market and internal conditions [3] - As of the end of 2018, the company had partially proven reserves of 43.36 million tons of ore with a WO3 metal content of 5,103 tons, along with various associated resources [3] - The company has a significant demand for externally purchased tungsten products and monitors prices regularly to mitigate the impact of price fluctuations [3] - The company noted that while the rise in tungsten prices increases the cost and selling price of tungsten wire for photovoltaic applications, the recovery value of waste tungsten wire has also increased, partially offsetting costs [3] - The company believes that tungsten wire has advantages over high-carbon steel wire and has a promising market outlook as a next-generation material [3] - The company produces according to demand and manages inventory cautiously to avoid risks associated with price volatility [3]

Group 1: Company Operations - The company’s tungsten mines are currently operating normally, with a monthly production capacity that is not specified [1] - The company primarily uses tungsten concentrate, with an approximate usage ratio of 50% [2] - As of December 31, 2018, the Iron Cangzhai mine has a proven ore reserve of 433,600 tons and a WO3 metal content of 5,103 tons [2][3] Group 2: Market Conditions and Pricing - The company’s sales prices are adjusted according to fluctuations in tungsten concentrate prices, which helps mitigate the impact of raw material price volatility on operating performance [3][4] - Rising tungsten prices have increased the costs and selling prices of tungsten wire used in photovoltaic applications, but the recovery value of scrap tungsten has also risen, offsetting most costs [4] Group 3: Future Exploration and Supply - The company has not conducted detailed exploration of most areas in the Iron Cangzhai mine, but plans to develop exploration plans based on market conditions and internal assessments [2] - The company does not rely on a single or few suppliers for tungsten concentrate, ensuring a diversified supply chain [3]

Summary of Xiamen Tungsten Industry Conference Call Company Overview - **Company**: Xiamen Tungsten Industry - **Date**: August 22, 2025 Key Financial Performance - **Net Profit**: The company reported a net profit attributable to shareholders of 580 million yuan for Q2 2025, with a non-recurring profit of 923 million yuan, representing a year-on-year growth of 7.53% [2][3] - **Total Assets**: As of June 30, 2025, total assets reached 47.1 billion yuan, an increase of 3.64% from the previous year [2][5] - **Net Assets**: Shareholder equity was 16.3 billion yuan, up 2.32% year-on-year [2][5] - **Return on Equity**: The weighted average return on equity was 15.96%, down 2.79 percentage points due to refinancing impacts [2][5] - **Cash Flow**: Operating cash flow was approximately 800 million yuan, a decrease attributed to increased inventory [2][5] Revenue Breakdown by Segment - **Tungsten and Molybdenum**: Contributed 46% of total revenue and 75% of total profit [6] - **Energy New Materials**: Accounted for nearly 40% of revenue and 20% of profit [7] - **Rare Earths**: Contributed 14% of revenue and about 7% of profit [8] Market Dynamics - **Tungsten Prices**: The average price of domestic black tungsten concentrate was approximately 150,000 yuan/ton, with APT prices reaching a historical high of 222,900 yuan/ton, reflecting a year-on-year increase of 12.23% [8] - **Market Position**: The company maintains a strong position in the tungsten market, with APT and other products ranking among the top domestically [9] Segment Performance Highlights - **Cutting Tools**: Revenue grew by approximately 13%, with a profit increase of 29%. Key customer sales rose by 50%, and overseas revenue saw significant growth [10] - **Rare Earths**: Prices for neodymium-praseodymium oxide increased by 12%, while the company achieved a 40% increase in domestic sales of magnetic materials [16] - **Battery Materials**: Revenue reached 7.534 billion yuan, up 18%, with lithium cobalt oxide sales increasing by 57% [20] Strategic Initiatives - **Investment Projects**: The company invested 977 million yuan in various projects, including 656 million yuan in wood business and 155 million yuan in rare earth projects [21] - **Future Plans**: The company aims to achieve 5 billion yuan in revenue from the cutting tools business within five years through organic growth and acquisitions [29] Challenges and Risks - **Cost Pressures**: Rising raw material prices pose challenges to cost control, although the company is optimizing supply chain management [40] - **Market Demand**: Despite healthy demand, there are concerns about customer hesitance due to rising prices, which could affect order volumes [44] Conclusion - **Outlook**: The company is well-positioned in the tungsten and rare earth markets, with strong financial performance and strategic initiatives aimed at growth. However, it must navigate cost pressures and market dynamics to maintain its competitive edge.

Core Viewpoint - The price of tungsten products has been continuously rising this year, driven by supply constraints and increasing demand from various industries, particularly in the renewable energy sector [1][3][4]. Price Trends - Tungsten concentrate prices have surged, with a recent increase of 3,000 to 10,000 yuan per ton. As of August 20, the price for 65% tungsten concentrate was 217,000 yuan per ton, up 51.75% since the beginning of the year [1]. - The price for ammonium paratungstate (APT) reached 311,500 yuan per ton, reflecting a 47.98% increase year-to-date, while tungsten powder prices rose to 482.5 yuan per kilogram, up 53.91% [1]. Supply and Demand Dynamics - Supply has tightened due to a reduction in mining quotas set by the Ministry of Natural Resources, with a 6.45% decrease in the first batch of tungsten mining quotas for 2025 compared to 2024 [3]. - Major tungsten-producing regions, such as Jiangxi and Yunnan, have also seen significant reductions in mining output, leading to a sharp decrease in market circulation [3]. - Demand for tungsten is growing, particularly in hard alloy applications across various sectors, including aerospace, defense, and electronics. The demand for tungsten in the renewable energy sector is expected to exceed 4,500 tons by 2025 [3]. Market Outlook - Short-term prospects for tungsten prices are positive, driven by restocking needs and export recovery. However, long-term supply constraints may lead to a sustained increase in tungsten prices [4]. - The profit distribution within the tungsten industry is characterized by a "smile curve," where companies at both ends of the value chain are likely to benefit from rising tungsten prices [4]. Stock Performance - Tungsten-related stocks in the A-share market have generally risen, with an average increase of 10.1% since August. Notable performers include Luoyang Molybdenum, Zhongtung High-tech, and Xianglu Tungsten, with cumulative increases of 22.48%, 18.99%, and 17.41%, respectively [5][9]. - Some tungsten stocks are currently undervalued, with a median rolling P/E ratio of 30.24 times, and companies like Shengtun Mining and Luoyang Molybdenum have P/E ratios below 20 times [6]. Company Performance - Shengtun Mining has the lowest valuation with a rolling P/E ratio of 12.41 times and holds 32,200 tons of tungsten metal in its own mines [7]. - Among the companies that have reported earnings, a significant proportion (75%) showed positive growth, with Luoyang Molybdenum expected to report a net profit of 8.2 to 9.1 billion yuan for the first half of the year, marking a year-on-year increase of 51.37% to 67.98% [7].

Core Viewpoint - Xiamen Tungsten's proposed fundraising of up to 4 billion yuan for various projects has attracted scrutiny from the Shanghai Stock Exchange, which has issued an inquiry regarding the rationale behind the fundraising scale and its necessity for the company's operations [1][4]. Fundraising Details - The company plans to raise no more than 4 billion yuan through a stock issuance, with funds allocated for the expansion of hard alloy cutting tools, construction of a 1,000 billion meter photovoltaic tungsten wire production line, and the development of the Bobo County Yuma Po tungsten-molybdenum mine, as well as for working capital [2][4]. - The distribution of the raised funds includes 1 billion yuan for the hard alloy cutting tools expansion, 1.05 billion yuan for the photovoltaic tungsten wire project, 750 million yuan for the tungsten-molybdenum mine, and 1.2 billion yuan for working capital [2]. Project Implementation - The hard alloy cutting tools expansion project will involve the purchase of advanced equipment and is expected to achieve an annual production capacity of 2 million overall cutting tools, 30 million indexable inserts, and 1.7 million superhard tools, primarily serving sectors such as aerospace, general machinery, new energy, and medical equipment [3]. Regulatory Scrutiny - The Shanghai Stock Exchange has raised questions regarding the necessity of the fundraising projects, the funding methods through non-wholly owned subsidiaries, and whether other shareholders will proportionately contribute to project funding [4]. - The exchange also inquired about the rationale behind the new production capacity, market competition, major customers, and the company's ability to absorb the new capacity [4]. Financial Performance - Xiamen Tungsten's revenue for 2020, 2021, 2022, and Q1 2023 was 18.964 billion yuan, 31.852 billion yuan, 48.223 billion yuan, and 8.562 billion yuan, respectively, with net profits of 956 million yuan, 1.695 billion yuan, 2.183 billion yuan, and 653 million yuan [5]. - In the first half of this year, the company reported a revenue of 18.730 billion yuan, a year-on-year decrease of 22.47%, and a net profit of 791 million yuan, down 12.88% year-on-year [5][6]. Future Outlook - The exchange has requested explanations for the fluctuations in revenue and net profit, the sustainability of future growth, and the reasons behind the continuous decline in gross margin [6].

Investment Rating - The report maintains a "Buy" rating for Xiamen Tungsten Co., Ltd. [1] Core Views - Xiamen Tungsten is focusing on the development of three core businesses: tungsten-molybdenum, rare earths, and energy new materials, creating a synergistic industrial ecosystem with significant technical, resource, and industrial chain collaboration effects [5][20] - The company has a complete tungsten industry chain and has achieved a closed-loop operation in its rare earth business, continuously consolidating its leading position in the new energy battery materials sector [5][20] - The company is expected to benefit from long-term growth in three major industries due to its full industrial chain layout, technological barriers, and production capacity advantages, with projected EPS for 2025-2027 being 1.33, 1.59, and 1.79 yuan, corresponding to PE ratios of 18.62, 15.65, and 13.84 times respectively [5][21] Summary by Sections Company Overview - Xiamen Tungsten was established in 1958 and has evolved into a leading player in tungsten products, rare earths, and energy materials, with a focus on high-end manufacturing and technology [13][20] Tungsten Business - The tungsten industry is experiencing supply contraction and accelerating demand, with Xiamen Tungsten controlling nearly 30% of China's tungsten metal reserves [5][40] - The company’s tungsten business achieved revenue of 17.41 billion yuan in 2024, a year-on-year increase of 5.78%, driven by rising tungsten concentrate prices and increased sales of fine tungsten wire [56][21] Rare Earth Business - Xiamen Tungsten has established a collaborative system covering the entire rare earth industry chain, with a focus on high-value-added areas [5][72] - The company aims to maintain a long-term mining capacity of over 200,000 tons of REO in Fujian province through strategic partnerships [5][72] Energy New Materials Business - The energy new materials segment includes lithium-ion battery materials, with the company being a global leader in cobalt lithium, holding the largest market share [5][20] - In 2024, the company’s lithium-ion cathode material sales reached 98,600 tons, maintaining a leading position in the domestic industry [5][20] Financial Performance - In 2024, Xiamen Tungsten reported total revenue of 35.196 billion yuan, a decrease of 10.66% year-on-year, while net profit attributable to shareholders increased by 7.88% to 1.728 billion yuan [21][28] - The company’s gross profit margin improved to 18.03% in 2024, reflecting effective cost control and business structure optimization [28][29]

Investment Rating - The report maintains a "Buy" rating for Xiamen Tungsten Co., Ltd. [1] Core Views - Xiamen Tungsten is focusing on the development of three core businesses: tungsten-molybdenum, rare earths, and energy new materials, creating a synergistic industrial ecosystem with significant technical, resource, and industrial chain collaboration effects [5][20] - The company has a complete tungsten industry chain and has achieved a closed-loop operation in its rare earth business, continuously consolidating its leading position in the new energy battery materials sector [5][20] - The company is expected to benefit significantly from long-term growth in these three industries due to its full industrial chain layout, technological barriers, and production capacity advantages [5] Summary by Sections Company Overview - Xiamen Tungsten was established in 1958 and transitioned to tungsten products in 1982, becoming a publicly listed company in 2002 [13] - The company has expanded into the energy materials sector since 2003 and the rare earth sector since 2006, establishing itself as a leading player in these fields [13] Tungsten Business - The tungsten business achieved revenue of 174.14 billion yuan in 2024, a year-on-year increase of 5.78%, driven by rising tungsten concentrate prices and increased sales of fine tungsten wire [56] - The company controls nearly 200,000 tons of tungsten metal reserves, accounting for about 30% of the national total, and has a leading position in the hard alloy sector [56][59] - The fine tungsten wire sales reached 135.4 billion meters in 2024, a year-on-year increase of 56%, with photovoltaic tungsten wire sales of 107 billion meters, up 41% [59] Rare Earth Business - Xiamen Tungsten has established a collaborative system covering the entire rare earth industry chain, from mining to high-value-added applications [5][20] - The company aims to maintain a long-term mining capacity of over 200,000 tons of REO (rare earth oxides) in Fujian Province through strategic partnerships [5] - The rare earth business generated revenue of 44.35 billion yuan in 2024, a year-on-year decrease of 19.21%, but profits increased by 67.44% due to a 16% rise in magnetic material sales [21] Energy New Materials Business - The energy new materials business focuses on lithium-ion battery materials, including lithium cobalt oxide and ternary materials, with a sales volume of 98,600 tons in 2024, maintaining a leading position in the domestic market [5][20] - The company is a global leader in lithium cobalt oxide, holding the largest market share worldwide [5] - The energy materials business generated revenue of 132.97 billion yuan in 2024, a year-on-year decrease of 23.19%, but the sales volume of lithium cobalt oxide and ternary materials increased by approximately 33% [21]

Core Insights - Fujian Industrial Holding Group has officially launched, integrating metallurgy, light textile, and electromechanical sectors, with total assets exceeding 150 billion yuan and over 50,000 employees, marking a significant shift in the competitive landscape of state-owned enterprises in Fujian [1][4] - The establishment of the group aims at dual objectives of upgrading traditional industries and fostering strategic emerging industries, achieving full industry chain control in key areas such as steel, tungsten, new energy, and paper [4] Group Structure and Leadership - The group was formed under the strategic deployment of the Fujian provincial government, focusing on a comprehensive approach rather than mere asset aggregation [4] - The leadership team, led by Yang Fang, features a mix of experienced professionals from various sectors, reflecting the dual mission of traditional industry breakthroughs and new industry advancements [4] Key Listed Companies - **Xiamen Tungsten**: Positioned as the core platform for the tungsten industry, holding 20% of global tungsten resources, the company is focusing on technology-driven solutions, including innovative tungsten wire production and breakthroughs in semiconductor materials [6][7] - **Xiamen Tungsten New Energy**: This company is innovating in the solid-state battery sector, significantly reducing costs and enhancing energy density through new material technologies [9] - **Furong Technology**: Known for its "super-elastic aluminum" used in foldable smartphones, the company has secured a significant market share with advanced processing techniques [11] - **Minguang Steel**: Undergoing a transformation with investments in smart steelmaking and product upgrades, the company aims to enhance efficiency and reduce environmental impact [13] - **Qingshan Paper**: Pioneering bamboo pulp technology, the company is focused on sustainability and aims to significantly increase its green product sales [15] Future Directions - Fujian Industrial Holding Group is planning to invest 5 billion yuan in key technologies over the next three years, aiming to establish a national-level intelligent manufacturing demonstration factory and enhance its capital operations [17] - The group is working towards creating an integrated industrial ecosystem that spans metals, non-metals, and new energy, potentially serving as a model for state-owned enterprise reform in eastern coastal provinces [17]

Group 1: Company Overview and Operations - The company holds tungsten mining rights in the Iron Cangzhai area, covering an area of 5.96 square kilometers, with mining for tungsten, tin, and copper [2] - As of the end of 2018, the proven reserves include 433,600 tons of ore with 5,103 tons of WO3 metal, and additional resources of copper, tin, molybdenum, and silver [5] Group 2: Production Capacity and Projects - The photovoltaic tungsten wire project at the Chaozhou Fengquan Lake plant has a production capacity of 500 million meters per month, with a goal of reaching an annual output of 30 billion meters of ultra-fine tungsten wire [3] - The company is focusing on hard alloy and tungsten wire projects to drive high-quality development and improve profitability [4] Group 3: Market Trends and Future Outlook - The tungsten market is expected to experience a tightening supply-demand situation, with continued growth in consumption anticipated through 2025 due to advancements in low-altitude economy and additive manufacturing technologies [5] - The global demand for tungsten is projected to rise as the world economy recovers, with prices expected to increase due to the strategic importance of tungsten resources [4] Group 4: Financial Performance and Growth Drivers - The company anticipates growth in hard alloy production and sales starting from Q4 2024, driven by national infrastructure projects [3] - The ultra-fine tungsten alloy wire project is expected to create new profit points for the company in the renewable energy sector [3]

Group 1 - The company has stated that recent changes in the international trade environment have had a limited impact on its business, with tariffs being manageable [2] - The company is enhancing its operational resilience by accelerating overseas industrial chain layout, with established production bases in Thailand, South Korea, and France [2] - Significant progress has been made in the company's three major sectors: tungsten-molybdenum, rare earth, and energy new materials, with multiple projects either completed or underway [2] Group 2 - In the tungsten-molybdenum sector, six projects, including the production line for Jiujiang Jinlu blades and the tungsten oxide production base in South Korea, have been put into operation [2] - The rare earth sector has completed the acquisition of a rare earth mine in Laos and is steadily implementing various magnetic materials and recycling projects [2] - The energy new materials sector is expanding production in locations such as Fujian, Sichuan, and France, with ongoing capacity expansion for ternary precursors and lithium iron phosphate [2] Group 3 - The company is committed to protecting investor rights through standardized governance mechanisms, with plans for five shareholder meetings in 2024, over half of which will have participation from minority shareholders [2] - The company has distributed a total of 1.786 billion yuan in dividends over the past five years, with a planned dividend payout ratio of 38.59% for 2024 and a mid-term dividend implementation planned for 2025 [2] - Independent directors have consistently fulfilled their supervisory responsibilities, with information disclosure receiving an A rating from the Shanghai Stock Exchange for six consecutive years [2] Group 4 - In business expansion, the company has achieved mass production of tungsten wire with a diameter of 28μ and is constructing a production line with an annual output of 100 billion meters [3] - The rare earth permanent magnet materials are being rapidly deployed in new scenarios such as humanoid robots, with a 5000-ton magnetic material project in Baotou expected to be operational in the second half of 2025 [3] - The company is simultaneously advancing the divestment of its real estate business, having transferred part of its equity in Xiamen Tengwang Pavilion, with future capital expenditures focused on integrating the tungsten and rare earth supply chains and technology research and development [3]