In today’s briefing:
- The Metals Company – Entering a pivotal year
- CPMC Holdings (906 HK): What’s Brewing?
The Metals Company – Entering a pivotal year
The Metals Company’s (TMC’s) pioneering journey towards mining polymetallic nodules from the deep sea continues. There are inevitable hurdles to surpass, such as Greenpeace’s recent protests, which were a minor disturbance. With a further funding option now in place the company is well positioned to deliver a crucial milestone, submission of an exploitation application in 2024 as planned.
CPMC Holdings (906 HK): What’s Brewing?
- CPMC Holdings (906 HK) is currently suspended from trading. We think the announcement is likely to involve China Baowu Steel acquiring all stakes from its largest shareholder COFCO.
- There are benefits to be realised as Baowu also owns a packaging A-share Shanghai Baosteel Packaging-A (601968 CH). CPMC’s 1H23 result is very solid with good margin expansion.
- Despite a 61.5% rally YTD, CPMC does not look expensive at 10.9x and 9.9x PERs for FY23 and FY24. These are levels at discounts to peers which are mostly A-shares.
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