Results Review

3Q25 results beat our expectations

In 1–3Q25, Zijin Mining's revenue rose 10.33% YoY to Rmb254.2bn; net profit attributable to shareholders rose 55.45% YoY to Rmb37.86bn; and recurring net profit attributable to shareholders grew 43.71% YoY to Rmb34.13bn. In 3Q25, revenue fell 2.58% QoQ to Rmb86.49bn; net profit attributable to shareholders grew 11.02% QoQ to Rmb14.57bn. Attributable net profit in 3Q25 beat market expectations, mainly due to higher-than-expected non-recurring income. In 3Q25, recurring attributable net profit rose 6.47% QoQ to Rmb12.5bn, in line with our expectations.

Trends to watch

The firm's earnings grew sharply YoY and QoQ due to rising sales volume and higher prices of its products.

Mined copper: Lower production volume, higher prices, and higher costs. In 3Q25, copper prices rose 2.1% QoQ to Rmb79,785/t. Copper output was 829,900t in 1–3Q25, and declined by 16,200t QoQ to 263,100t in 3Q25, mainly due to the impact of the Kamoa-Kakular copper mine. Production costs rose 4% YoY in 3Q25 to Rmb25,400/t.

Mined gold: Prices and sales volume both increased; costs rose. In 3Q25, gold prices rose 3% QoQ to Rmb793/g. Gold output reached 64.9t in 1–3Q25, and increased by 1.6t QoQ to 23.8t in 3Q25, with incremental output mainly coming from the Akyem gold mine and the Savayalton gold mine in Xinjiang. Production costs rose 2.9% QoQ to Rmb280/g in 3Q25.

Mined zinc: Stable production volume, lower prices, and higher costs. Zinc prices fell 1.6% QoQ to Rmb22,000/t in 3Q25. Zinc output stayed largely flat QoQ at 271,100t in 1–3Q25 and about 91,500t in 3Q25. Production costs rose 0.9% QoQ in 3Q25 to Rmb10,100/t. In 1–3Q25, the completion rates of mined copper, silver, and gold production plans reached 62%, 72%, and 76%.

Core projects progressing steadily; efficient capital operation unleashing value of gold resources. The first phase of the firm's lithium mine came on stream at end-3Q25. The firm expects the second phase of the Julong mine project to start production at end-2025, and the Xiangyuan mine project to start trial production in 4Q25. Meanwhile, the firm has acquired controlling stakes in Zangge Mining and the Shapinggou molybdenum mine in Anhui province. Zijin Gold International was listed on the main board of the Hong Kong Stock Exchange on September 30, which we think has boosted the valuation of the firm's overseas gold assets, optimized its capital structure, and further strengthened its overseas capital operation and industrial empowerment capabilities.

Financials and valuation

Considering higher-than-expected non-recurring income and higher copper and gold prices in 3Q25, we raise our 2025 and 2026 attributable net profit forecasts 11.2% and 18.8% to Rmb50.91bn and Rmb65.09bn. We maintain our OUTPERFORM ratings for A-shares and H-shares. Given the rising average valuations of A-share and H-share mineral resource sectors, we lift our target prices 31% and 33% to Rmb38 for A-shares and HK$40 for H-shares. A-shares are trading at 15.5x 2025e and 12.1x 2026e P/E. Our TP implies 19.8x 2025e and 15.5x 2026e P/E, offering 27.7% upside. Hshares are trading at 15.5x 2025e and 12.0x 2026e P/E. Our TP implies 19.1x 2025e and 14.8x 2026e P/E, offering 23.2% upside.

Risks

New copper supply beats expectations; lower-than-expected interest rate cut by the US Federal Reserve; disappointing capacity expansion.