12 January 2026 | 9:01PM JST Equity Research ASIA TECH OUTLOOK & RESURGENT JAPAN Seizing the Global Growth Opportunity: A broader and deeper AI presence in the Asian supply chain Kicking off 2026, we present our Asia technology (hardware) team's investment strategy for the year, focus areas, and stock recommendations. First, as our overall strategy for 1H26, we recommend a priority focus on investment in the AI supply chain, given its growing influence on earnings growth and in view of the debate around a s ...

Investment Rating - The investment rating for Jiangxi Copper is "Buy" with a target price of HK$27.90, indicating an expected share price decline of 12.2% from the current price of HK$31.76 [6]. Core Insights - The long-term treatment charge and refining charge (LT TC/RC) for copper concentrate is expected to be lower year-on-year in 2026, reflecting a tight supply situation as the LT TC/RC covers approximately 80% of total purchased overseas copper concentrate in 2025, down from 90% in previous years [1][2]. - The company plans to avoid large-scale maintenance work for copper smelting capacity until the LT TC/RC price for the next year is determined, with an anticipated increase in the percentage of spot TC/RC in the fourth quarter of 2025 if the LT TC/RC price remains low [3]. - Management believes that the impact of anti-involution on the copper smelting industry will primarily affect new capacity rather than existing capacity, as copper demand is expected to continue increasing, thus limiting the impact on copper prices [4]. - The copper foil business is projected to incur a net loss in 2025, but strong orders for lithium battery copper foil since September 2025 are expected to improve profitability in 2026, despite processing fees not significantly increasing [5]. Summary by Sections Valuation - Jiangxi Copper's H-shares are valued at HK$27.90 based on a combination of discounted cash flow (DCF) and price-to-book (P/B) fair values, with a DCF valuation yielding an NPV-per-share of HK$32.90 and a P/B valuation yielding HK$22.90 [8].