Company Overview
Jiangxi-Copper is the nation's largest integrated copper producers, its copper reserves is 1/3 of the whole Chinese industrial reserve. Additionally, Jiangxi-Copper is also an important chemical industry base in China.
Summary
The revenue growth of Jiangxi-Copper in 1HY of 2012 is significant, but with rapid increase of multiple costs, the profit margin has been decreasing obviously.
Since the market demand goes down continuously, the profit margin will be lower in the future. Besides, multiple projects will put into operation in 2HY that may exacerbate the industry capacity.
The non-ferrous metals market will fall into recession probably. Besides, since most countries adopt loose monetary policy that will affect the effect of QE3 and the price rebounding of non-ferrous metals. It`ll also put negative influence to company operation results.
The EPS of 1HY of 2012 is CNY 0.77, we estimate that the operation performance of 2012 won`t be good as 2011, the EPS of 2012 will be CNY 1.4, the target price in next 6 months is HKD 17.95 with 10x PE, the rating is Reduce.
Financial Data

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