Zhaojin Mining Industry Company Limited (01818.HK) Expectations of interest rate cuts boost gold prices, Q3 revenue surges YOY February 7, 2024 378

PSR Recommendation: BUY Status: Upgraded
Target Price: HKD12.60

Overview
Zhaojin Mining (1818.HK) is a comprehensive gold producer and gold smelting enterprise
that integrates exploration, mining, mineral processing and smelting operations and focuses
on developing the gold industry. The company’s main products are “9999 gold” and “9995
gold” standard gold ingots; its main production technology and equipment have reached
domestic leading and international advanced levels. The company is located in Zhaoyuan
City, Shandong Province, China. This place is rich in resources, has a unique geographical
location and a long history of gold mining. According to statistics from the China Gold
Association, Zhaoyuan City’s gold resources account for about one-tenth of China’s total
remaining gold resources. It is an important gold production base which is known as the
“Gold Capital of China”. The company has a number of subsidiaries and joint-stock
companies nationwide, and its business covers major gold-producing regions across the
country. As of December 31st, 2022, the company had a total of approximately 38.29 million
ounces of gold mineral resources and approximately 15.50 million ounces of mineable gold
reserves. In the first half of 2023, a total of 13.92 tons of new gold metal were completed in
exploration.
Company Performance review
As of September 30, 2023 (Jan-Sep), the company’s revenue was 6.39 billion yuan (RMB, the
same as below), an increase of 10.3% YOY. Operating costs were 3.91 billion yuan, a slight
increase YOY. Operating profit was 791 million yuan, an increase of 29.6% YOY. Net profit
was 538 million yuan, an increase of 29.7% YOY. The company’s Q3 performance achieved
substantial year-on-year growth, mainly due to the increase in gold sales prices.

About the author

Profile photo of Margaret Li

Margaret Li
Analyst
Research

本科主修市場行銷和英語,並於香港浸會大學獲得經濟學碩士學位。現為輝立証券持牌分析師,主要負責能源和公用事業等板塊的研究。曾在大型銀行、券商和資產管理公司工作,對於期貨和大宗商品衍生品領域擁有銷售、研究分析和市場推廣等工作經驗。 Margaret, a holder of a Bachelor`s degree in Marketing and English and a Master`s degree in Applied Economics from Hong Kong Baptist University, is currently employed as a licensed analyst at Phillip Securities. She specializes in conducting research focusing on the energy and utilities sectors. Prior to her current position, Margaret gained valuable work experience in a large bank, securities firm, and asset management companies. Her expertise lies in sales, research analysis, and marketing within the fields of futures and commodities derivatives.

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