港股研究_江西銅業(英文版)(pdf 32頁)

港股研究_江西銅業(英文版)內容提要：
Self-produced cathode copper and Sulphuric acid will be the main driverfor Jiangxi Copper’s earnings momentum in 2010-2012. We are still morepositive on Jiangxi Copper (JXC) due to its ings upside potential. OurEPS forecasts for 2010–2012 are RMB 1.21 、1.45、1.52 respectively. We arereiterating Buy.
Copper, the best fundamentals across the mining sectors Copper has the bestfundamentals across the mining sectors, with low inventory, limited idle capacityand a lack of committed new projects. Downstream processors indicate demandsexcept from property are still strong and even property will not be a tissue inChina for a long term.
JXC’s self-produced cathode copper output volume will arply rise in 2011For copper concentrate, Fujiawu Mine will increase by 41 thousand tons in 2011,Yongping Mine will increase by 5 housand tons in 2011, Chenmenshan Minewill increase by 9 thousand tons in 2011.
Sulphuric products will be a surprise Sulphuric acid price will rebound fromthe bottom due to the recovery of global conomy. In the first half of 2008, about25% of the total gross profit was devoted by sulpuric products. This year, eventhe sulphuiric acid price reaches only half of the 2008 highest, the gross fitdevoted by sulphuric products will be a surprise.
Valuation and rating JXC valuation is cheap, in our view, based on: (1) Shareprice-implied copper price is RMB40000. (2) JXC is current trading at 16.5X2009 PE. Our 12-m target price of HK$19.24 is based on up-cycle multiple of15.9X 2010E PE, implying 29% potential upside. (3)Global peers are trading at19.1X 2009 PE vs. JXC’s 16.5X. (4) Global peers are trading at 2.8X 2009 PB
vs. JXC’s 1.7X.
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