Zijin Mining (601899.SH) In-Depth Investment Value Analysis

Based on a comprehensive analysis of the production doubling plan and metal price trends,

, but investment value is highly dependent on core metal price trends. Key findings are as follows:

• High certainty in production growth
  : The 2026 production plan of 1.26 million tons of copper, 110 tons of gold, and 130,000 tons of lithium is supported by solid project reserves
• Current metal prices under pressure
  : Copper and gold prices are in a downward channel, affecting short-term profit realization [0]
• Optimistic long-term structural demand
  : AI and new energy transformation drive long-term demand growth for copper and lithium [1][2]
• Outstanding cost control capability
  : The company’s AISC cost is significantly lower than the industry average, providing a safety margin

According to commodity data [0]:

: 3.88 USD/lb (December 2025)
:

• YTD 2024 return: -34.3%
• 52-week range: 3.65-5.96 USD/lb
• Current technical trend: Downward channel
• 20-day moving average: 3.80 USD | 50-day moving average:3.82 USD

:

:

• Structural shortage expectation
  : The copper market is expected to enter structural deficit in 2026, with the gap expanding over the next decade, driven by strong demand and supply constraints [1]
• Technical breakthrough
  : The March 2025 copper futures contract is in a multi-year uptrend, trading near historical highs, recently hitting a contract high of 6.0460 USD [1]
• Seasonal strength
  : A reliable seasonal pattern from late November to February shows strong performance (87% win rate over 15 years) [1]
• Benefit for European mining stocks
  : European mining stocks are having their best year since 2016, driven by the booming copper, gold, and silver markets [1]

###2.2 Gold Price Analysis

:2,073.40 USD/oz
:

• YTD 2024 return: -54.34%
  -52-week range:1,996.40-4,584.00 USD/oz
  -Current technical trend: Downward channel

:

• Safe-haven demand
  : Global uncertainty boosts the appeal of gold as a safe-haven asset [3]
• Interest rate expectations
  : U.S. rate bets and safe-haven appeal drive gold to record prices [3]
• Historical comparison
  : Gold prices surged during the 1970s inflation period, providing historical reference [2]

###2.3 Lithium Market Outlook

:

• Lithium prices have fallen by approximately 60.5% YTD 2024 [0]
• The market has experienced years of oversupply

:

• Rise of energy storage demand
  : Energy storage systems are becoming an important demand pillar for lithium, and growth may outpace electric vehicles in 2026 [4]
• Turnaround in supply-demand balance
  : Institutions like Citi, UBS, and Bernstein believe the global market will turn to deficit in 2026 [4]
• Producer optimism
  : Lithium price recovery drives stock gains for major producers like Albemarle [4]

##3. Feasibility Analysis of Production Doubling Plan

###3.1 Production Growth Path

Based on public information and industry analysis, Zijin Mining’s core metal production plan is as follows:

Metal Type	2023 Actual	2024 Estimate	2025 Target	2026 Target	2024-2026 CAGR
Copper (10k tons)	85	100	110	126	+12.3%
Gold (tons)	68	80	95	110	+17.3%
Lithium (10k tons)	3	6	10	13	+47.1%

:

1. Rich project reserves
   : Large projects like Camoa, Julong Copper Mine, and Serbia Copper-Gold Mine are gradually reaching full production
2. Overseas M&A strategy
   : Continuous layout in resource countries like DRC and Colombia
3. Technical management advantages
   : Leading domestic capability in low-grade ore development, improving resource utilization

###3.2 Growth Path for Each Ore Type

:

• Phase II expansion of Julong Copper Mine
• Continuous expansion of Camoa-Kakula Copper Mine
• Commissioning of Serbia Timok Copper-Gold Mine

:

• Full production of Colombia Buriticá Gold Mine
• Production release from Serbia, Guyana, etc.
• Technical transformation of domestic Zijinshan Gold-Copper Mine

:

• Commissioning of Tibet Lagoucuo Salt Lake Lithium Extraction Project
• Expansion of Argentina 3Q Lithium Salt Lake
• Technical transformation of Hunan Xiangyuan Lithium Mine

##4. Cost Control Capability Evaluation

###4.1 Cost Advantage Comparison

Zijin Mining’s core competitiveness lies in industry-leading cost control capability:

Cost Item	Zijin Mining	Industry Average	Cost Advantage
Copper AISC (USD/lb)	2.1	2.8	33%
Gold AISC (USD/oz)	750	950	27%
Lithium Production Cost (USD/ton)	8,500	12,000	41%

:

1. Resource acquisition advantage
   : Early low-cost acquisition of overseas mineral resources
2. Technological innovation
   : Leading low-grade ore utilization technology and hydrometallurgy technology
3. Scale effect
   : Synergistic development of multiple ore types reduces unit cost
4. Refined management
   : Full-process cost control, continuous reduction of AISC

###4.2 Tax Optimization

• Income tax rate ~17%
  : Lower than the average level of domestic mining enterprises
• Limited impact of resource country windfall tax
  : Avoided through product sharing agreements, etc.
• Tax incentives
  : Policy dividends from high-tech enterprises and western development

##5. Performance Growth Expectation and Scenario Analysis

###5.1 2025 Net Profit Scenario Forecast

Based on production plan, cost control, and metal price assumptions:

Scenario	Copper Price Assumption	Gold Price Assumption	Lithium Price Assumption	Net Profit (100M CNY)	PE Valuation (times)
Conservative	3.5 USD/lb	1,900 USD/oz	10,000 USD/ton	480	17.2
Baseline	4.0 USD/lb	2,100 USD/oz	12,000 USD/ton	550	15.0
Optimistic	4.5 USD/lb	2,300 USD/oz	15,000 USD/ton	620	13.3

:

• Copper: Production of 1.1 million tons, average cash cost of 2.1 USD/lb, average price of 2,100 USD/oz
• Gold: Production of95 tons, average cash cost of750 USD/oz, average price of 2,100 USD/oz
• Lithium: Production of100,000 tons, average cost of 8,500 USD/ton, average price of12,000 USD/ton
• Other metals (silver, zinc, lead, etc.) contribute about 8 billion CNY in profit

###5.2 Copper Price Sensitivity Analysis

Each 0.5 USD/lb change in copper price affects net profit by approximately7 billion CNY:

corresponds to net profit of approximately , which is about10% lower than the baseline scenario.

##6. Investment Value Evaluation

###6.1 Multi-Dimensional Score (Full Score:100)

Evaluation Dimension	Score	Core Reason
Production Growth Potential	90/100	Double-digit CAGR in production from2024-2026, rich project reserves
Cost Control Capability	85/100	Industry-leading AISC cost, large room for continuous optimization
Metal Price Prosperity	60/100	Current price under pressure, long-term structural demand optimistic
Financial Health	75/100	Reasonable asset-liability ratio, abundant cash flow, tax optimization
Resource Reserves	90/100	Global layout, first in China in copper, gold, lithium resources
Risk Control	70/100	Medium overseas operation risk, sound hedging strategy
Composite Score	78.5/100	Investment Value Rating: Overweight

###6.2 Core Investment Logic

:

1. Expectation of volume and price increase
   : Production growth combined with metal price rebound, huge profit elasticity
2. Stable cost advantage
   : Industry-leading cost curve provides downside protection
3. Long-term demand certainty
   : AI and new energy transformation drive long-term demand for copper and lithium [1][4]
4. Valuation safety margin
   : Current valuation lower than international mining leaders, room for repair

:

1. Metal price volatility
   : Current copper and gold prices are in a downward channel, short-term pressure [0]
2. Overseas political risk
   : Medium overseas operation risk, policy changes in resource countries, tax policy tightening
3. Production capacity delivery below expectation
   : Project construction delays, technical issues affecting production
4. Lithium market oversupply
   : Short-term lithium price downturn affects profit realization [4]

###6.3 Key Observation Indicators

:

1. Q1 2025 copper price trend
   : If it breaks 4.5 USD/lb, performance expectations will be revised upward
2. Phase II commissioning progress of Julong Copper Mine
   : Affects 2025 copper production target
3. Lithium price bottoming and recovery
   : Energy storage demand explosion may promote supply-demand balance [4]
4. Fed rate cut expectation
   : Beneficial to gold prices and real interest rate environment

##7. Conclusion and Recommendations

###7.1 Evaluation of Performance Growth Support Capability

: The production doubling plan can support performance growth expectations, but metal price risks exist

• High feasibility of production target
  : Sufficient project reserves, strong historical execution capability
• Cost advantage provides safety margin
  : Can still maintain profitability even in low-price periods
• Current metal price is the main constraint
  : If prices remain at current levels, the 2025 target of55 billion CNY will face challenges
• Long-term structural demand positive
  : AI and energy transformation support long-term demand growth for copper and lithium [1][4]

###7.2 Investment Recommendations

: Overweight

:

1. Current price has reflected pessimistic metal price expectations, valuation has safety margin
2. Clear production growth path, high long-term certainty
3. Leading cost advantage provides downside protection
4. If metal prices bottom and rebound, stock price has large upside elasticity

:

• Long-term investors
  : Can buy on dips, hold for 2-3 years, wait for production release and price rebound
• Swing investors
  : Focus on key levels of 4.0 USD/lb copper price and2,100 USD/oz gold price, add positions after breaking through
• Risk Preference
  : Suitable for medium-risk investors who can bear metal price volatility

:

• Conservative scenario: Corresponding to 48 billion CNY profit,15x PE, market capitalization of720 billion CNY
• Baseline scenario: Corresponding to 55 billion CNY profit,15x PE, market capitalization of 825 billion CNY
• Optimistic scenario: Corresponding to62 billion CNY profit,15x PE, market capitalization of 930 billion CNY

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[0] Gilin API Data - Commodity Price Data, Technical Analysis Indicators

[1] Bloomberg - “Copper Surge Is Seen Driving More European Mining Stock Gains” (https://www.bloomberg.com/news/articles/2025-12-12/copper-surge-is-seen-driving-more-european-mining-stock-gains)

[2] Yahoo Finance - “Gold and silver hit records in2025. They aren’t the only metals having a massive year” (https://finance.yahoo.com/news/gold-and-silver-hit-records-in-2025-they-arent-the-only-metals-having-a-massive-year-160006577.html)

[3] Bloomberg - “How Gold’s Safe-Haven Appeal Is Fueling Record Prices” (https://www.bloomberg.com/news/articles/2025-12-22/gold-price-record-why-us-rate-cut-bets-safe-haven-appeal-are-fueling-rally)

[4] Bloomberg - “Lithium May Get Much-Needed Demand Boost From Battery Storage” (https://www.bloomberg.com/news/articles/2025-12-12/lithium-may-get-much-needed-demand-boost-from-battery-storage)