CICC Gold (600489): High-quality copper and molybdenum asset injection performance will increase significantly

CICC Gold (600489): High-quality copper and molybdenum asset injection performance will increase significantly

Guide to this report: The company plans to purchase and purchase 90% equity of Inner Mongolia Mining. After completion, the net profit attributable to the mother will increase significantly.

The United States may enter the rate cut cycle, and the rise in gold prices will bring performance flexibility to the company.

Investment Highlights: The first increase in holdings.

Comprehensive PB and FCFF estimation methods, 南京夜网 taking into account that the parent company China Gold Group promises to continue to inject gold assets, and the performance of the Inner Mongolia mining industry will significantly increase after the injection, and the financial costs will decrease after the debt-to-equity swap is completed.

71 yuan, predicting the company’s net profit for 2019-2021 3.



250,000 yuan, corresponding to EPS 0.



12 yuan; considering Inner Mongolia’s mining consolidation, the pro forma net profit is 10.



4.7 billion (reference performance commitment caliber).

Pre-acquisition results correspond to PE 107 for 2019-2021.



5 times the estimate, corresponding to 19% of space, increase the level of holdings.

The rate cut cycle is approaching, and gold prices are expected to bloom.

Assuming a substantial recession in the US economy, the price of gold at the beginning of the interest rate cut cycle will perform better.

Looking ahead to the interest rate cut cycle that may occur in the second half of 2019 and beyond, we believe that this round of interest rate cuts will begin when the U.S. economy peaks and declines, deteriorating substantially, and recent data have been shown, so the basis for judging the price of gold has strengthened.

According to the company’s mining gold output 23.

Calculated at 51 tons, every 10 yuan / g gold price increases, the company’s performance increases by 1.

1.9 billion US dollars (different interests of minority shareholders in the main mine), benefiting from rising gold prices.

The additional issue of the acquisition of Inner Mongolia Mining, asset injection is still expected in the future.

The company intends to provide China Gold Group with 6.

68 yuan / share purchased 90% equity of Inner Mongolia Mining by shares plus cash for 37.

970,000 yuan, the performance commitment for 2019 is about 7.

500 million.

At the same time, the company implemented debt-to-equity swaps and raised 2 billion matching funds, which significantly reduced financial expenses.

The company holds 496 tons of gold / copper metal / 37 seconds, and produces 23 gold / copper per year.

51 tons / 1.

8 Initially, the company’s annual output of copper will increase by 6.

9 initial.

As for the parent company, Gold Group currently holds approximately 1,908 tons of gold metal and 1,022 tons of copper metal, and promises to continue to inject high-quality resources into CICC Gold.

Catalysts: Fixed-income acquisitions completed, rising gold prices Core risks: less-than-expected progress in resource extension; copper prices fell; fixed-growth was below expectations