Northeast Securities released a research report indicating that gold prices are expected to maintain a long-term bullish trend. Given ZIJIN GOLD INTL's strong alpha attributes, including resource acquisition capabilities, mine operations proficiency, and production fulfillment, it deserves a higher valuation and has been rated as a "Buy." The firm anticipates that the company's net profit attributable to shareholders will reach approximately $1.29 billion, $2.27 billion, and $2.84 billion for 2025, 2026, and 2027, respectively, representing year-on-year growth rates of 169%, 75%, and 25%. Currently, the company has a gold resource amount of 1,812.7 tons, with 851.9 tons of gold reserves (including the RG mine in Kazakhstan). By the end of 2024, it is expected to rank around 10th globally in terms of reserves to production ratio. The management team primarily comprises veterans from Zijin Mining, possessing strong expertise and field experience in mining. Key points from Northeast Securities include:

Where does ZIJIN GOLD INTL's alpha lie? 1) Resource acquisition capabilities: The cost of acquisitions is significantly lower, with an average gold mine acquisition cost of $61.3 per ounce from 2019 to 2024, below the industry average of $92.9 per ounce. Moreover, the acquired mines continue to increase their reserves; for instance, both the Rossbeal and Akim gold mines have shown over 70% growth in resources since acquisition as of the end of 2024. 2) Mine operating capabilities: By optimizing stripping ratios and dilution rates, as well as adjusting ore processing techniques to enhance recovery rates, the company successfully turned previously unprofitable mines into profitable ventures. The average grade of its producing mines is around 1.4 g/t, with AISC costs around $1,400-$1,500 per ounce, ranking 6th among the top 15 gold producers, while costs are expected to stabilize in 2024-2025H1. 3) Production fulfillment capabilities: The company's production growth rate over the past three years was 21%, making it the fastest in the large gold stocks category. Moreover, the fulfillment of production guidance has been high (99%, 101%, and 103% for the six operating mines from 2022 to 2024). Looking ahead, with both organic growth and external mergers and acquisitions, the company's gold production CAGR is projected to maintain a high growth rate of over 15%.

Gold prices are expected to maintain a long-term bullish trend: 1) In the medium term: Central bank gold purchases are expected to remain above 1,000 tons annually, combined with China’s unwavering enthusiasm for gold. This dynamic has led to a divergence from traditional frameworks, as funds in Europe and America have recently shifted significantly towards gold amid a prolonged interest rate cut cycle and an inflationary backdrop in the U.S. economy. A diverse range of buyers will continue to support the bullish gold market. 2) In the long term: Currency depreciation and geopolitical tensions are significant factors driving the current super bull market in gold. On one hand, U.S. fiscal policy continues to expand cyclically, leading to mounting government debt; on the other hand, the Federal Reserve's independence is being challenged, particularly with the Trump administration selecting a new Fed chair. This could potentially result in fiscal policies overshadowing monetary policies, further creating upward momentum for gold prices. Additionally, ongoing geopolitical tensions are likely to attract various buyers, prompting a reallocation of some dollar assets towards gold.