Zijin Mining 2899

[winston]

Not vested

Order sought:

1. An order be granted by the People’s Court against Xinyi Zijin and Xinyi Baoyuan to pay RMB19,500,000 to compensate losses, and in respect of loss exceeding the amount of RMB19,500,000, further proceedings will be filed separately upon full verification of the amount of loss.

2. All costs of the present proceedings be borne by the defendant.

http://www.hkexnews.hk/listedco/listcon ... 018009.pdf

[winston]

Clean-up claims rub luster off Zijin by Tony Liaw, The Standard HK:-

Shares of Zijin Mining Group (2899) fell sharply in Shanghai and Hong Kong yesterday after two subsidiaries faced claims for nearly 20 million yuan (HK$23.35 million) following a fatal dam collapse at a tin mine last month.

Xinyi Zijin Mining and Xinyi Baoyuan Mining received a court notice saying Xinyi city is seeking 19.5 million yuan in compensation for economic losses, according to a filing with the Hong Kong stock exchange.

The stock fell 7.8 percent - the most in 11 months - to end at 9.47 yuan in Shanghai. In Hong Kong, Zijin ended 4.7 percent lower at HK$7.46. Analysts said the compensation claim, together with a retreat in gold prices, pushed Zijin's shares lower.

"Zijin was expecting the compensation to be around nine million yuan," said Kenny Tang Sing-hing, head of research at Redford Securities, adding that investors were taking profits as gold-related stocks have gained recently.

Zijin - China's biggest gold miner - surged 45 percent in the eight trading sessions before yesterday.

"A short rebound in the US dollar gave space for a correction in gold price," said Conita Hung Lai- ping at Delta Asia Financial.

The dam collapse at the tin mine in Guangdong took place last month resulting in 28 fatalities. Zijin may face further action if losses from the collapse top 19.5 million yuan. In July, Fujian authorities fined the firm 9.56 million yuan for a toxic spill.

http://www.thestandard.com.hk/news_deta ... 01019&fc=2

[winston]

Not vested

DJ MARKET TALK: Credit Suisse Keeps Zijin Mining At Outperform

0922 [Dow Jones] STOCK CALL: Credit Suisse keeps Zijin Mining (2899.HK) at Outperform, target HK$9.60.

Notes 3Q10 net profit down 21% on-quarter, +28% on-year at CNY1.13 billion; on-quarter fall mostly due to lower volume, higher cost after production disruption from recent accident.

"We expect Zijin to continue to benefit from record gold prices. However, cost recovery from the accident may take longer. While short-term financial impact is limited, the long-term risk remains on both operational costs and capex on higher environmental standards."

Notes implied gold price at US$850/oz, almost US$500/oz discount to spot price and US$150/oz discount to closest peer Zhaojin (1818.HK). Stock ends yesterday down 2.0% at HK$7.54.


Source: Dow Jones Newswire

[winston]

Not vested. From Phillips:-

Risks

The global economy recovers with no inflation and the gold price drops seriously.
Smelting process might produce environmental pollution and increase the expenditure.
The acquisition and expansion are not as expected.


Attractive evaluation, continue to buy in

Based on the expectation of continuous growth and rising sales price, we expect that the Company will realize a revenue of RMB27.4 billion and RMB33.1 billion in 2010 and 2011, with an annual growth rate of 36% and 21% respectively, and realized a net profit of RMB5.3billion and RMB7.3billion, with an annual growth rate of 49% and 38%, and with an EPS of RMB0.364 and RMB0.503 respectively.

As to its evaluation, with an overview of gold-related stocks, we could find that they normally enjoy one time premium of valuation compared with the corresponding market index. We evaluated separately the gold and non-gold businesses of Zijin Mining.

The former was evaluated with the above method and the latter was evaluated with reference to the historical evaluation of a Company in the same category—Jiangxi Copper.

Also in combination with negative environmental factors and the weak market, we give a conservative rating: 25 times and 12 times PE ratio to 2010EPS for its gold and copper business; and the 12-month target price is HKD8.83. We recommend investors continue to buy in.

[winston]

Not vested

DJ MARKET TALK: Zijin Down; To Keep Underperforming N/T -Tanrich

1208 [Dow Jones] Zijin Mining Group (2899.HK) is down 0.6% at HK$6.77, following its guidance of a 30%-40% on-year rise in 2010 net profit, which is below market expectations.

Based on its 2009 net profit at CNY3.5 billion, its 2010 net profit will likely be between CNY4.6 billion-CNY5.0 billion vs a CNY5.345 billion average forecast based on a Thomson Reuters survey.

"The profit guidance is actually reflecting the impact from a string of negative news," says Tanrich's investment manager Jackson Wong. He expects the stock to continue to underperform in the near-term, and tips a long-term target price at HK$8.00.

Zijin is down 11.2% over the past year compared to its peer Zhaojin Mining Industry (1818.HK), which rose 90.8% over the same period mainly due to the record-run of gold prices.

Among the negative news in 2010, Zijin said in September that its direct economic loss, from a production halt owing to heavy rainfall at its Yinyan Tin Mine, was about CNY19 million.

Source: Dow Jones Newswire

[winston]

Not vested

BUY Zijin (2889 HK) as we believe its sell-off has overshot beyond any possible negative news.

Valuation looks attractive as its main business is unscathed and gold prices should stay high.

Risk: Faster-than-expected easing of geopolitical tension and reduced gold holding by hedge funds (such as Paulson and Soros) which would be reported on 14 February should trigger a consolidation in gold prices.


Source: UOBKH

[Muhajir]

Hi Everyone,

Thank you for all the valuable info winston. I am vested in this one at 6.03. So for me any info/opinions on this one will be appreciated as I am still a novice.

[winston]

Hi Muhajir,

Welcome to InvestIdeas !

Since Copper and Gold prices would be affecting the price of Zijin, you may also be interested in the "Copper" and 'Gold" threads, located in the Commodities section.

Take care,
Winston

[Muhajir]

Thank You Winston for the very warm welcome. It's really appreciated.

Going to check them threads out now.

Ali

[winston]

Not vested

DJ MARKET TALK: Zijin +2.6%; HK$8.30 Resistance - BGC

1527 [Dow Jones] Zijin Mining (2899.HK) is +2.6% at HK$6.30, likely supported by Thursday's strength in gold prices; Comex April gold futures ended at a fresh five-week high Thursday (+0.7% at $1,385.10/oz).

Jamie Coutts, Asian equities sales at BGC Securities says the Zijin's valuations look fair, as the recent stock price translate to about 14X FY12 P/E. Still he says Zijin's ROE is well above its peers at 24%.

"It would seem from the level of underperfomance that the market de-rating of Zijin over the past three years looks to have now run its course as multiples are now in line with its global peers." He tips the stock's November 2010 high of HK$8.30 as a strong resistance.


Source: Dow Jones Newswire