Category: Money tips Release Date: 2006-02-27
Strong performance of the contract price in 2007 the leading style of Jin Xian
The company in 2007 coking coal contract price increases in the range of 30 yuan / ton, a province of thermal coal price increases 30 yuan / ton, mixed coal price increases in the range of 15-30 yuan / ton. Meanwhile, the company said it has not yet received the relevant policy-related cost increases file until after the introduction of the policy will be in consultation with the user re-coal prices. We believe that in 2007 coal contract prices shown strong pricing power of domestic coking coal from the company as the industry leading position, while also downstream industries such as steel and the economy continued to rally on. The company said that since the fourth quarter of 2006 since the downstream sector demand is very strong, tight supply, while coking coal as the company sold more than 95% of Anshan Iron and Steel, Tangshan Iron & Steel, Shougang, Wuhan Iron and Steel and other major domestic iron and steel enterprises, therefore, the downstream industry, efficiency continued to improve the ability to accept the price increase makes. On the whole, if the policy-related increase in costs higher than the company's current price rises, the company is expected to again raise the policy after the introduction of coal prices, and policy-related costs to downstream industries.
Xingxian mining progressed smoothly in 2010 can be formed 1,500 million tons of production capacity at present, Xingxian mine development proceeded smoothly, oblique groove and Yang Ping and mineral output is expected in 2007 up to 300 million tons. Meanwhile, the harsh tile railway has commenced, the present work had been completed about half the length of 48 km. 1,500 million tons of the overall planning of the new mining areas have passed environmental impact assessment, the overall plan will soon be issued, and is expected with the completion of the railway in 2007 to start 2010.
Integration of resources to seize the initiative, indirect control of resources amounting to 30 billion tons
The company through the acquisition of helical groove, as well as Yang Ping Xingxian coal into Xingxian mine, marking the company officially took over the six coal in Shanxi Province, to develop the latest piece of coal, that is, Hedong coalfield. White Xingxian mine, the company direct control of the resources of up to 20 million tons. However, we think the company thus indirectly control the amount of resources should be up to the 10 billion tons, mainly because Xingxian mine total reserves of about 39.639 billion tons, with an average seam thickness of 12 meters, coal for coking coal, fat coal, very suitable for mechanized mining. With the development of a mining area in Shanxi Province with a subject as the main content of the gradual integration of resources to promote the future development of the entire Xingxian mine will have to take Xishan Coal and Electricity-driven to expand.
Syndicates in Shanxi coal production from the entire point of view, in the six coalfield in Shanxi Coking Coal Xishan Coal and Electricity Group, the parent company by virtue of its Fenxi Coal Group, the Huozhou Coal Mining Group and the Western Hills group, three of which have been occupied Coalfield, namely: Horsey coalfield, east of the river coalfield, Xishan Coalfield. The future, in China's coal resources to speed up integration of the context, Shanxi Coking Coal Group, the industry leader by virtue of the status and the abundant local resources, resources to expand the potential of very prominent. Shanxi Coking Coal Group's current production capacity to reach 7,000 million tons / year around 2010, is expected to reach 100 million tons. The company's future is expected to continue to acquire coal mines in order to achieve extension of group-type expansion, from this standpoint, it became Yidun Ji coking coal industry, leading just around the corner.
Last revised in 2007 and 2008 financial forecasts
According to 07 and in 2008 coal prices is expected, and taking into account the income tax impact of the merger in 2008, we will be 07,08-year earnings per share from 0.82 yuan, 0.83 yuan and 0.94 yuan raised to 0.86.
Conclusion
As the coking coal industry leader, we believe that the company in 2007 to give a more reasonable 18 times earnings, whereby a 12-month target price raised to 10.66 yuan from 15.48 yuan, compared with the current share price up 23.8% of the space, to maintain "overweight "investment rating.
