Core Insights - Huayou Cobalt Co., Ltd. experienced a 5.05% increase in stock price, reaching 65.97 CNY per share, with a trading volume of 4.603 billion CNY and a turnover rate of 3.76%, resulting in a total market capitalization of 125.295 billion CNY [1] Company Overview - Huayou Cobalt, established on May 22, 2002, and listed on January 29, 2015, is located in the Tongxiang Economic Development Zone, Zhejiang Province. The company specializes in the research and manufacturing of new energy lithium battery materials and cobalt new materials [1] - The revenue composition of Huayou Cobalt includes: nickel products (34.54%), cathode materials (16.28%), trading and others (15.55%), nickel intermediates (14.91%), copper products (5.95%), ternary precursors (5.25%), lithium products (4.18%), and cobalt products (3.33%) [1] Fund Holdings - According to data from the top ten holdings of funds, one fund under Chuangjin Hexin holds a significant position in Huayou Cobalt. The Chuangjin Hexin Resource Theme Selected Stock A (003624) held 638,400 shares in the third quarter, accounting for 5.14% of the fund's net value, making it the fourth-largest holding. The estimated floating profit for today is approximately 2.0237 million CNY [2] - The Chuangjin Hexin Resource Theme Selected Stock A (003624) was established on November 2, 2016, with a current scale of 372 million CNY. Year-to-date returns are 67.61%, ranking 280 out of 4,216 in its category; the one-year return is 51.99%, ranking 710 out of 3,885; and since inception, the return is 276.33% [2] Fund Manager Performance - The fund managers for Chuangjin Hexin Resource Theme Selected Stock A (003624) are Li You and Huang Chao. Li You has a cumulative tenure of 9 years, managing assets totaling 4.582 billion CNY, with the best fund return during his tenure being 262.31% and the worst being -42.15% [3] - Huang Chao has a cumulative tenure of 2 years and 173 days, managing assets totaling 819 million CNY, with the best fund return during his tenure being 61.64% and the worst being 59.67% [3]

Core Viewpoint - Company Huayou Cobalt's revenue is expected to exceed 100 billion yuan in the coming years, driven by strong performance in nickel and lithium sectors, with significant growth in revenue and profit reported in the latest half-year results [1][9]. Group 1: Financial Performance - In the first half of the year, Huayou Cobalt achieved revenue of 37.2 billion yuan, a year-on-year increase of 23.78%, and a net profit of 2.7 billion yuan, up 62.26%, both setting historical records for the same period [1]. - Nickel product shipments reached 139,400 tons, a year-on-year increase of 83.91%, significantly contributing to the company's revenue growth [3]. - Revenue from nickel products and intermediate products grew by 137.54% and 68.32% respectively, making them the primary sources of revenue and profit, accounting for 49.4% and 57.9% of total revenue and gross profit [3][4]. Group 2: Business Expansion and Projects - The company has several upcoming projects, including a 50,000-ton lithium sulfate project and wet processing projects in Indonesia, which are expected to contribute to future revenue growth [2][7]. - The Pomalaa and Sorowako wet processing projects are in collaboration with partners and are expected to be operational by the end of 2026 [6]. Group 3: Market Conditions and Price Trends - Nickel prices are at a five-year low, with limited downside potential, while cobalt and lithium prices have shown signs of recovery [2][8]. - The average price of battery-grade lithium carbonate has risen over 41% from its low in late June, indicating a potential rebound in the market [8]. Group 4: Valuation and Market Sentiment - Analysts project Huayou Cobalt's revenue for 2025 to be between 68 billion and 74 billion yuan, with some estimates for 2026 exceeding 80 billion yuan [9]. - The company's market capitalization is expected to potentially return to the 100 billion yuan level, having previously exceeded 170 billion yuan during the peak of the lithium battery industry in 2021 [10].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company is expected to see stable nickel profits in Q2, with cobalt performance showing elasticity. The forecast for H1 2025 indicates a net profit of 2.6-2.8 billion, representing a year-on-year increase of 56%-68% [7] - Nickel wet-process projects are expected to continue overproducing, with a projected shipment of over 70,000 tons in Q2, maintaining stable profits. The company anticipates nickel intermediate shipments of over 280,000 tons for the year, a 25% increase year-on-year [7] - Cobalt prices are expected to rise, potentially leading to a second wave of price increases in the second half of the year, with the company’s cobalt projects contributing significantly to profits [7] - Copper is expected to contribute stable profits, while lithium is projected to break even. The company aims for a total copper shipment of 90,000 tons for the year, contributing 700-800 million in profits [7] - The sales of positive materials are expected to recover significantly, with a target of 130,000 tons for the year, a 30% increase year-on-year [7] - The profit forecast has been adjusted upwards for 2025-2027, with expected net profits of 6 billion, 6.75 billion, and 8.24 billion respectively, reflecting a growth of 44%, 12%, and 22% [7] Financial Summary - Total revenue for 2023 is projected at 66.304 billion, with a year-on-year growth of 5.19%. The net profit attributable to the parent company is expected to be 3.351 billion, down 14.25% year-on-year [1] - The earnings per share (EPS) for 2025 is estimated at 3.53 yuan, with a price-to-earnings (P/E) ratio of 10.58 [1] - The company’s total assets are projected to reach 138.963 billion by 2025, with total liabilities of 84.779 billion [8]

Report Industry Investment Rating - Not provided Core Viewpoints - Nickel and stainless steel may continue to fluctuate widely in the short term. The audit event of Indonesia's Tsingshan Industrial Park may affect the production of nickel intermediates and stainless steel. The support of ore prices still exists, but there is a certain deviation between the short - term nickel ore and the market trend. The nickel - iron price is still falling, and the demand in the stainless steel market is weak during the off - season. The demand for nickel salts in the new energy chain recovers slowly. Attention should be paid to spot transactions and macro news [1][4][5] Summary by Relevant Contents 1. Price and Management Strategy - **Price Forecast**: The predicted price range of Shanghai nickel is 115,000 - 124,000 yuan/ton, with a current volatility of 15.17% and a historical percentile of 3.2% [3] - **Inventory Management Strategy**: When product sales prices fall and inventory has depreciation risks, short Shanghai nickel futures (60% ratio) and sell call options (50% ratio) to lock in profits and hedge against spot price drops [3] - **Procurement Management Strategy**: When the company has future production procurement needs and is worried about rising raw material prices, buy long - term Shanghai nickel contracts and sell put options according to the production plan, and also buy out - of - the - money call options [3] 2. Market Situation - **Nickel Market**: Intraday, Shanghai nickel continued to fluctuate. The follow - up of the Indonesia audit event may affect production. The support of ore prices still exists, but there is a deviation between short - term nickel ore and the market trend. Nickel - iron prices are falling, with large profit pressure and weak procurement [4] - **Stainless Steel Market**: In the off - season, demand is weak. Spot sales are mainly through price concessions, and overall transactions are average [4] - **New Energy Chain**: The demand for nickel salts recovers slowly, maintaining a production - to - order situation [4] 3. Market Data - **Nickel Disk Data**: The latest price of Shanghai nickel main contract is 118,890 yuan/ton, with a 0% change. The LME nickel 3M price is 15,095 US dollars/ton, up 0.39%. The number of warehouse receipts decreased by 1.69% [6] - **Stainless Steel Disk Data**: The latest price of the stainless steel main contract is 12,575 yuan/ton, with a 0% change. The number of warehouse receipts decreased by 1.80% [7] - **Inventory Data**: Domestic social nickel inventory is 39,383 tons (up 8 tons), LME nickel inventory is 203,598 tons (down 522 tons), stainless steel social inventory is 1,000.6 tons (up 1.8 tons), and nickel pig iron inventory is 34,610 tons (up 3,148 tons) [8] 4. Market Influencing Factors - **Positive Factors**: Some stainless steel mills announced production cuts, the cost of nickel ore prices is supported, and the government's review of some enterprises in Indonesia's Morowali Park may affect production [5] - **Negative Factors**: Stainless steel enters the traditional off - season, inventory clearance is slow, the contradiction in the nickel - iron industry chain deepens, and the demand for precursors in the new energy chain is weak [5]