In-depth Analysis of High Growth Potential and Valuation Logic of Copper Mining Enterprises

• Can High Growth Sustain?
  : Yes. The copper mining industry is in a “super cycle” driven by new energy, AI computing power, and grid upgrades; leading enterprises have clear capacity expansion plans and resource reserves, so growth is sustainable.
• Valuation Logic
  : Driven by the three pillars of “resources + growth + commodity prices”, current valuations are in a reasonably high range; there is still significant upside potential in optimistic scenarios.
• Market Cap Ceiling
  : In the long run, global demand-supply gaps will support high prices; coupled with mergers and acquisitions and capacity doubling, industry leaders have room to move closer to global top mining giants.

• Global new copper mine capacity in 2025 is about 500,000 tons, lower than the demand increment of about 800,000 tons, so the supply-demand gap continues to expand [3].
• Leading miners’ H1 2025 output increased by 2.8% YoY, with Chinese copper enterprises contributing the main increment; overseas miners’ free cash flow generally declined, capital expenditure willingness is weak, and supply constraints are strong [3].
• Frequent accident disruptions (e.g., mining accidents in Indonesia and Chile) further suppress short-term supply, and the trend of normalized mining accidents may continue [3].

• New Energy Vehicles
  : Global sales are expected to exceed 30 million units in 2025, with 80-100 kg of copper per vehicle (4x that of fuel vehicles), bringing about 250,000 tons of new demand [3].
• Grid Infrastructure
  : China’s “14th Five-Year Plan” grid investment exceeds 500 billion yuan annually; Europe and the US continue to promote new energy supporting grid construction; copper used in grids accounts for over 40% [3].
• AI Computing Centers
  : High energy consumption drives power transmission demand; each cabinet uses 100-200 kg of copper; AI computing power expansion brings continuous increments to copper demand [3].
• Other increments: Photovoltaic, wind power, energy storage, military industry, and overseas manufacturing reshoring all form medium- to long-term demand support [3].

• From Jan to Nov 2025, the average LME copper price was about $9,704/ton, with the annual high breaking $11,000/ton and a fluctuation range of $8,539-$11,068/ton [3], indicating a continuous upward shift in the price center. Monthly futures closing prices are also in a long-term upward trend (cumulative +65.8% in 2025) [0].
• Interest rate cut cycles and the strengthened financial attributes of dollar pricing form additional support for copper prices [3].

• Zijin Mining (601899.SS)
  : 2025 YTD increase +117.2%, closing price 33.17 yuan, TTM P/E ~19.7x, market cap ~880.1 billion yuan [0].
• CMOC (603993.SS)
  : YTD increase +191.4%, closing price 19.48 yuan, TTM P/E ~24.7x, market cap ~418.8 billion yuan [0].
• Both companies’ valuations are in the reasonable range of the industry, but stock prices have fully reflected optimistic expectations for 2025; need to track subsequent production fulfillment and price trends.

• Profitability
  : Zijin’s ROE ~30.6%, net profit margin ~13.91%; CMOC’s ROE ~26.48%, net profit margin ~9.59% [0].
• Cash Flow
  : Zijin’s free cash flow ~24.063 billion yuan; CMOC ~27.485 billion yuan [0].
• Debt Risk
  : Zijin has medium risk; CMOC has low risk and more stable finances [0].

• Zijin Mining
  : Baseline scenario fair value is 38.45 yuan (+15.9% vs current), optimistic scenario 60.23 yuan (+81.6%), probability-weighted target price ~43.70 yuan (+31.8%) [0].
• CMOC
  : Baseline scenario fair value is17.04 yuan (-12.5% vs current), optimistic scenario31.02 yuan (+59.2%), probability-weighted target price ~19.87 yuan (+2.0%) [0].
• Conclusion: If copper prices remain high and capacity is released as scheduled, the upside space in the optimistic scenario is considerable; conversely, if prices correct or project implementation falls short of expectations, valuations may come under pressure.

###1) Clear Capacity Expansion Paths

• Zijin Mining
  :
  • Tibet Julong Copper Mine Phase II is expected to start production at the end of2025; then annual copper output will increase to ~300-350 thousand tons; Phase III is planned to be600 thousand tons, expected to become a world-class super-large copper mine [1].
  • Kamoa, Juno and other overseas projects continue to ramp up; logistics improvements in DRC and Tanzania reduce costs [1].
  • The company predicts that copper and gold production will increase by several ten thousand tons and ~20 tons respectively in 2026; the medium- to long-term growth path is clear [1].
• CMOC
  :
  • DRC’s TFM and KFM two world-class copper-cobalt mine projects continue to reach production capacity; H12025 copper output increased by 28% YoY to356 thousand tons, cobalt +42% to 53 thousand tons, becoming the world’s largest cobalt producer [2].
  • Plans to break through copper capacity of800 thousand tons in 2027 and move toward1 million tons in2028, doubling capacity in five years [2].
  • Technologies like bioleaching make unit costs15%-20% lower than the industry average; profit elasticity is significant when copper prices are high [2].

###2) Cost Advantages and Moats

• CMOC’s TFM mine C1 cost is ~1.8 USD/lb, lower than the industry average of 2.5 USD/lb [2].
• Zijin Mining continues to reduce costs through digitalization and inventory refinement management; Julong and Kamoa projects’ grades and scales support long-term cost competitiveness [1].

###3) Resource Reserves and M&A Capabilities

• Zijin Mining has made counter-cyclical acquisitions for many years and has entered the global first tier in copper and gold resource reserves and capacity scale [1].
• CMOC has built a copper-cobalt + gold dual main business through endogenous growth + overseas acquisitions, strengthening cycle hedging capabilities; in 2025, it acquired Ecuador’s Cangrejos gold mine to open a second growth curve [2].
• International giants (BHP, Rio Tinto, Vale) are also increasing copper mining business, but Chinese enterprises have first-mover and scale advantages in key regions like Africa and South America [3].

• Commodity Price Volatility
  : If new energy penetration falls short of expectations, macro economy weakens, or the US dollar strengthens, copper price corrections will directly suppress profits and valuations.
• Project Execution and Geopolitics
  : Overseas mine construction faces risks such as construction cycles, community and environmental approvals, political situation, and infrastructure.
• Policy and Trade Environment
  : Tariffs, resource nationalism, and export restrictions may affect project cash flow and costs.
• Valuation Overdraft
  : Both companies have had huge YTD increases; short-term stock prices have already incorporated optimistic expectations; need to be vigilant about emotional fluctuations and corrections.

• Long-term Perspective
  : Driven by new energy, AI, and grid “new infrastructure”, copper demand has long-term rigidity; supply-side constraints and industry concentration increase support the upward shift of the price center. Leading enterprises with low costs, strong resources, and high-quality project reserves have the ability to ride through cycles.
• Valuation and Rhythm
  : Current valuations are reasonably high; can wait for phased corrections or commodity price verification periods before deploying. Batch buying, fixed investment, or holding leading enterprises are stable strategies.
• Stock Selection
  :
  • Zijin Mining: Balanced global layout, copper and gold dual-wheel drive, large valuation upside space; suitable for investors pursuing high growth.
  • CMOC: DRC copper-cobalt + gold portfolio, high growth elasticity, but not low valuation; more suitable for high-risk preference funds.
• Hedging and Allocation
  : Can moderately allocate gold, lithium batteries, rare earths, etc., to hedge portfolios and reduce single product volatility risks.

[0] 金灵API数据
[1] 雪球—“明年利润一千亿？详谈紫金矿业产量规划与利润测算”（https://xueqiu.com/1641200866/367988583）；中国国际矿业网—“紫金矿业：以新质生产力推动铜资源增储”（http://www.bjminexpo.com/cnt_478.html）；紫金矿业公告及财报汇总（https://www.zjky.cn/news/news-detail-122344.htm）
[2] 中国国际矿业网—“洛阳钼业2025年中期业绩亮眼”（http://www.bjminexpo.com/cnt_532.html）；东方财富网—“洛阳钼业：铜金双翼齐飞，全球资源巨头开启新黄金时代”（https://caifuhao.eastmoney.com/news/20251225094847796427890）；民生证券研报（PDF，https://pdf.dfcfw.com/pdf/H3_AP202504271663412757_1.pdf）
[3] 界面新闻—“价格创纪录新高，‘金属之王’进入超级周期”（https://www.jiemian.com/article/13676904.html）；澎湃新闻—“2026将至，国际矿业巨头都有哪些规划？（一）”（https://m.thepaper.cn/newsDetail_forward_32152654）；五矿证券—“2025H2全球铜矿供给更为紧俏——海内外24家半年报全扫描”（https://finance.sina.com.cn/roll/2025-10-10/doc-inftkzvm1384165.shtml）；期货日报/东方财富—“2025年铜定价权：资本、资源与供应的博弈”（https://finance.eastmoney.com/a/202503253354773453.html）；东吴证券研报（PDF，https://pdf.dfcfw.com/pdf/H3_AP202511271789464660_1.pdf）