The 2021 interim results of Zijin Mining were higher than market consensus and our estimation, mainly due to higher copper and zinc prices. Total revenue of the Company increased 32.14% yoy to RMB109.86 billion, and net profit attributable to shareholders increased 174.60% yoy to RMB6.65 billion.
Revise up copper and zinc price assumptions and maintain gold price assumptions unchanged. We expect gold price to benefit from loose monetary policy and investor demand for safe-haven assets; we expect the annual average gold price to be around US$1,850/oz in 2021. We expect the annual average copper price to be around US$9,000/t and the annual average zinc price to be around US$2,800/t in 2021.
Maintain mining output assumptions unchanged. The Company plans to produce 53-56 tons of mined gold, 0.54-0.58 million tons of mined copper and 0.45-0.48 million tons of mined zinc in 2021.
Revise up the TP to HK$12.75 and upgrade to "Accumulate".