The 3rd quarter results of the Company were lower than marketconsensus and our expectations. Total revenue of the Company in the first3 quarters was up 66.35% yoy to RMB33.41 billion, but net profit attributableto shareholders dropped 69.93% yoy to RMB 1.24 billion. The significant dropin profit was mainly attributable to lower metal price.
Revise down cobalt price assumptions but maintain other metal priceassumptions unchanged. We expect molybdenum and tungsten price to beflat or rise moderately in 2019 and 2020. We expect 2019 annual averagecopper price to be around US$6,100/t and the annual average copper priceto be around US$6,000/t-US$6,500/t in 2020. We revise down 2019 annualaverage cobalt price assumptions to around US$32,300/t and expect cobaltprice to rise moderately in 2020 and annual average price to be US$35,000/t-US$40,000/t in 2020.
Maintain mining production assumptions of the Company unchanged.
　　In 2019, the Company plans to produce 14,500-16,000 tons of metalequivalent molybdenum concentrate, 9,000-10,000 tons of metal equivalenttungsten concentrate, 30,000-32,000 tons of mined copper from Northparke,170,000-200,000 tons of mined copper and 16,500-19,000 tons of minedcobalt from Tenke. The production of the Company was stable and wemaintain mining output assumptions of the Company unchanged.
Revise up TP to HK$2.90, maintain "Neutral".