1H17 NPAT likely missed on non-op items
　　Jiangxi Copper released 1H17 profit alert with 60-80% YoY NPAT increase,implying 1H17 NPAT of RMB757-852m under PRC GAAP. Taking 70% YoYincrease, the company's 1H17 NPAT achieved 45% and 41% of DBe andconsensus, respectively. With 1Q17 NPAT of RMB541m, this preliminary resultsuggests a c.50% QoQ decrease in 2Q17 NPAT （。 Apart from 2.6%QoQdecline in copper price in 2Q17 （c.RMB40m+ earnings impact）， we believe thecompany might also have some impairments that lead to the QoQ profit decline.
　　Valuation and risks
　　Our target price of HKD12.7 is based on DCF life-of-mine methodology （WACCof 9.6%, Rf 3.9%, MRP 5.6%, and beta of 1.4）。 The stock is currently trading at22x/13x 2018/19 DBe EPS and 0.8x 2018/19 DBe BVPS. We believe the stock isfairly valued with ROE of 4% in 2018 and 6% in 2019, with our in-house copperprice forecast of $5900/t, $5725/t and $6800/t in 2017/18/19,respectively. We thusmaintain Hold rating. Risks include higher or lower copper price and higher orlower sales volume.