The golden glow illuminates the Hong Kong stock market once again!

On September 30, Zijin Gold International (2259.HK), spun off from Zijin Mining Group Company Limited (2899.HK), officially listed on the Hong Kong Stock Exchange. Opening with a surge of 65%, the stock maintained a 68.48% gain by market close, finishing at HK$120.6 per share with a total market capitalization of HK$316.5 billion.

As the second-largest IPO in Hong Kong's market this year, the company issued 349 million shares globally at HK$71.59 per share, raising approximately HK$24.47 billion in net proceeds. The offering attracted a prestigious cornerstone investor lineup of 29 global top-tier institutions, including Singapore's GIC, Hillhouse Capital, and BlackRock. Zijin Mining Group Company Limited Chairman Chen Jinghe rang the opening bell at the ceremony.

The listing of Zijin Gold International not only marks the year's second-largest Hong Kong IPO but also pushes the total market value of the "Zijin System" beyond the trillion-yuan threshold. Currently, the "Zijin System" encompasses four listed companies: Zijin Mining Group Company Limited (601899.SH, 2899.HK), Fujian Longking Co.,Ltd. (600388.SH), Zangge Mining Company Limited (000408.SZ), and now Zijin Gold International. Today's combined market capitalization of these four companies reached RMB 1.18 trillion, with individual valuations of RMB 782.4 billion, RMB 19.165 billion, RMB 91.591 billion, and RMB 316.5 billion respectively.

From a local mining enterprise in Shanghang, Fujian to a global mining giant, Zijin Mining Group Company Limited has built a vast ecosystem covering mineral resources, financial investment, and supply chain services through over twenty years of industrial development and capital operations. However, behind the impressive figures, global operational risks have become a "sword of Damocles" hanging overhead.

Zijin Gold International's eight core mines are distributed across Central Asia, South America, and Africa, with some regions facing geopolitical instability and policy discontinuity. For instance, its Buriticá Gold Mine in Colombia experienced a "golden heist," while operations in Kazakhstan face potential risks from local tax policy adjustments.

According to the prospectus, overseas business accounted for 100% of the company's revenue in 2024, making the balance between "global expansion" and "refined management" a primary challenge.

**Eight Gold Mines Generating $3 Billion Annual Revenue**

Zijin Gold International, spun off from Zijin Mining Group Company Limited, serves as the international gold mining platform, integrating all of Zijin Mining's gold mines outside China. The company primarily engages in gold exploration, mining, mineral processing, smelting, refining, and sales.

The prospectus reveals that Zijin Gold International operates eight overseas gold mines located across South America, Central Asia, Africa, and Oceania: Buriticá Gold Mine, Norton Gold Fields, Rosebel Gold Mine, Aurora Gold Mine, Geita/Tulawaka Gold Mine, Akyem Gold Mine, Left Bank Gold Mine, and Porgera Gold Mine.

According to Frost & Sullivan data, as of end-2024, Zijin Gold International's gold reserves totaled 856 tons, ranking ninth globally, with gold production of 40.4 tons, placing it eleventh worldwide. As of June 30, 2025, total mineral resources were estimated at approximately 1.176 billion tons.

Notably, Zijin Gold International's overseas gold mines have experienced a "golden heist" incident.

In December 2019, Zijin Mining Group Company Limited's parent company acquired Continental Gold, a major Colombian gold mining company, for CAD 1.33 billion (approximately RMB 7.03 billion).

Continental Gold held 100% interest in Colombia's Buriticá Gold Mine, the company's core asset. At the time, Zijin Mining announced that the acquisition would generate strong profits and cash flows, and once fully operational, the project would become Colombia's largest independent gold mine while increasing Zijin Mining's gold production by approximately 20%.

According to Zijin Mining's official website, the Buriticá Gold Mine currently holds 312 tons of gold resources with an average grade of 6.75 grams per ton.

Reports indicate that Colombia has seen the emergence of illegal miners who obtain access to mine tunnels, protection, and equipment from the "Gulf Clan," an armed paramilitary organization of approximately 7,000 members who traffic cocaine and migrants along routes to the United States. This organization facilitates illegal miners' occupation of Zijin Mining's tunnels in exchange for a share of the "spoils."

In 2023, conflicts between illegal miners and Zijin Mining personnel intensified within the mine tunnels, with Zijin Mining's security personnel having to defend against explosive devices and AK-47 rifle fire in confined passages.

Two mine security personnel were killed in 2023, with several others injured. Zijin Mining disclosed this incident in a May 2023 announcement.

The situation became so severe that it topped social media trending lists.

Zijin Mining issued a statement in November 2024 regarding the incident, stating that "due to historical reasons and site constraints, the Buriticá Gold Mine's shallow high-grade ore bodies have been controlled and illegally mined by unauthorized mining organizations, causing certain losses to Continental Gold, with the exact quantity of lost resources still under verification."

However, a Zijin Mining representative indicated that "the illegal mining has minimal impact on company performance."

From a financial perspective, Zijin Gold International has indeed shown rapid growth in recent years. From 2022 to 2024, company revenue grew from $1.818 billion to $2.99 billion, representing a compound annual growth rate of 28.2%. More remarkably, profit growth saw net profit attributable to shareholders increase from $183.7 million to $481.4 million, achieving a compound annual growth rate of 61.9%.

In the first half of 2025, Zijin Gold International generated revenue of $1.997 billion with net profit attributable to shareholders of $520 million.

**Zijin Mining Serves as Shareholder, Customer, and Supplier**

Behind Zijin Gold International's impressive performance over the past three and a half years, Zijin Mining Group Company Limited functions not only as the major shareholder but also as the largest customer and primary supplier.

The prospectus shows that during the reporting period, the company's top five customers included Zijin Mining Group, precious metals and other non-ferrous metal refiners, and trading companies. From 2022 to 2024, the top five customers contributed revenues of $1.275 billion, $1.769 billion, and $2.517 billion respectively, accounting for 70.2%, 78.2%, and 84.2% of total revenue.

The largest customer, Zijin Mining Group, contributed revenues of $598 million, $636 million, and $1.273 billion respectively, representing 32.9%, 28.1%, and 42.6% of total revenue.

Furthermore, the company's trade receivables are highly concentrated, with 67.35% of receivables coming from the largest customer as of 2024.

The cyclical volatility of the gold industry's impact on profitability has become an unavoidable issue for Zijin Gold International.

Financial data reveals a significant "amplification effect" between company performance and gold prices—when international gold prices rose 12% year-over-year in 2023, net profit growth reached 61.9%, far exceeding the gold price increase; however, when gold prices showed only minor corrections in 2022, net profit growth plummeted from 45% in 2021 to 11.2%.

This characteristic of "accelerated growth in favorable cycles and rapid contraction in adverse cycles" stems from the mining industry's high fixed-cost structure. The prospectus shows that in 2024, Zijin Gold International's gold mining costs reached $1,458 per ounce, accounting for 63.7% of the selling price ($2,288 per ounce).

Additionally, the complex game between "global layout" and "local compliance" continues to escalate.

For example, the Porgera Gold Mine project in Papua New Guinea failed to obtain an extension of its special mining license from the PNG government in 2019. It wasn't until April 2023 that Zijin Mining reached an agreement with Papua New Guinea to expedite full resumption of Porgera Gold Mine operations. During the 2020-2021 shutdown period, Porgera Gold Mine accumulated losses of approximately RMB 566 million.

**How Extensive is the Trillion-Yuan "Zijin System" Empire?**

While many people may still associate Zijin Mining Group Company Limited (601899.SH) with gossip about 63-year-old Chairman Chen Jinghe marrying his 38-year-old wife, the "Zijin System" has actually built a capital empire spanning multiple metal categories and controlling multiple listed companies.

In terms of capital operations, the "Zijin System" has constructed a multi-layered financing network. Beyond the dual listing platforms on A-shares (601899.SH) and H-shares (2899.HK), Zijin Mining has entered the financial sector through equity participation and controlling stakes, holding financial licenses including Zijin Insurance, creating a closed loop of "industrial cash generation + financial capital injection."

Zijin Mining originated from Shanghang County Mining Company established in 1986, reorganized as Shanghang County Zijin Mining Corporation in 1993, focusing solely on developing the Zijinshan Gold Mine. After completing share restructuring in 2000, the company listed in Hong Kong in November 2003.

Subsequently, Zijin Mining's expansion accelerated unstoppably. From 2005-2007, Zijin Mining achieved a compound annual growth rate of 121.43% in main business revenue and 98.13% in total profit. In 2005, Zijin Mining formally decided to expand overseas.

Zijin Mining listed on A-shares in 2008, with stock prices peaking immediately upon debut before declining for six months. However, the company's expansion pace remained unaffected.

According to data, from 2008's acquisition of 40% equity in Qinghai West Copper and 49% equity in Zijin Copper (achieving full control) through 2021, Zijin Mining completed 67 M&A transactions, with 44 agreements signed or implemented. Most involved asset purchases (or through subsidiaries) using primarily cash transactions, including major deals for Kamoa Copper Mine, BOR Copper, and Timok Copper (Gold) Mine.

Chen Jinghe's contribution has been indispensable. Over the years, Chen Jinghe has repeatedly acquired high-quality assets at relatively low prices during international copper and gold price troughs, with funding for these "acquisitions" coming from corporate bonds and ultra-short-term financing instruments.

Hard work pays off. According to Zijin Mining's official website, the company now operates over 30 important mining bases across 17 domestic provinces and 17 overseas countries. The company's overseas resource reserves, production, profits, and employee count all exceed domestic operations, ranking first in China for copper, gold, and zinc production, and fourth, sixth, and fourth globally respectively.

In Forbes' 2025 Global 2000 list, Zijin Mining ranked first among global listed gold companies and fourth among global metal mining companies. Return on equity ranks first among Fortune Global 500 metal mining companies, with profits ranking fourth globally. The company's market value once exceeded RMB 600 billion, ranking 21st among A-share listed companies.

During this period, Zijin Mining not only acquired mines but also purchased listed companies, achieving controlling or participating stakes in multiple public companies.

In 2022, Zijin Mining spent over RMB 1.7 billion to acquire controlling interest in Fujian Longking Co.,Ltd. (600388.SH). As of June 30, 2025, Zijin Mining remains the largest shareholder with a 21.08% stake.

In November 2022, Zijin Mining's Hong Kong subsidiary planned to acquire 654 million H-shares of Zhaojin Mining (1818.HK), representing 20% of total share capital, making Zijin Mining the second-largest shareholder. As of June 30, 2025, it maintains an 18.2% stake.

In September 2024, Longyan Kaolin Clay Co.,Ltd. (605086.SH) announced that Zijin Mining's wholly-owned subsidiary acquired 20% of shares through agreement transfer, becoming the second-largest shareholder. As of June 30, 2025, the shareholding ratio remained unchanged.

In October 2024, Zijin Mining subscribed to 165 million shares of Global Gold Group (3939.HK) at HK$8.33 per share for a total consideration of HK$1.374 billion. As of June 30, 2025, it held a 16.98% stake.

On January 16, 2025, Zijin Mining's wholly-owned subsidiary signed agreements to acquire 392 million shares of Zangge Mining Company Limited at RMB 35 per share, representing 24.82% of total share capital, for a total transaction value of RMB 13.729 billion.

Following completion, Zijin International and its concert parties held 395 million shares of Zangge Mining Company Limited, representing 25.99%, making Zijin International the controlling shareholder.

However, due to extensive acquisitions, Zijin Mining has experienced continuous cash outflows from investment activities in recent years. From 2022 to 2024, net cash flows from investment activities were -RMB 50.9 billion, -RMB 33.9 billion, and -RMB 32.2 billion respectively. To support M&A activities, the company frequently raises funds. As of end-2024, cash and cash equivalents totaled RMB 31.691 billion, while short-term borrowings and current portions of long-term debt reached RMB 48.748 billion, creating a funding gap exceeding RMB 10 billion.

Furthermore, Zijin Mining's revenue growth rate declined from 31.25% in 2021 to 3.49% in 2024—a nearly ten-fold slowdown in just three years. While 2024 net profit reached new highs due to soaring gold and copper prices, core business production growth in gold and copper remained limited, with profit growth primarily dependent on price factors, raising sustainability concerns.

From a local mining enterprise in Shanghang, Fujian to the "Zijin System" controlling four listed companies with over trillion-yuan market capitalization, Zijin Mining has pursued an aggressive global expansion path through two decades of acquisitions. The successful listing of Zijin Gold International represents both a milestone in gold business professional operations and elevates the "Zijin System's" capital empire to new heights.

However, beneath the glory, concerns persist. The "underground battlefield" at Buriticá Gold Mine, production losses at Porgera Gold Mine, funding gaps exceeding RMB 10 billion, performance volatility highly dependent on gold prices, and dual dependence on parent company Zijin Mining as both customer and funding source all challenge the "Zijin System's" global management capabilities.

More notably, with Zijin Mining Chairman Chen Jinghe now 68 years old, succession planning for this vast mining empire has become a continued market focus.

Behind the trillion-yuan market value lies the game between "expansion" and "stability," the balance between "scale" and "quality." After all, mining cycles are lengthy, and sustained success in global resource competition requires more than capitalizing on temporary opportunities.