HK Stock Market Move | MONGOL MINING (00975) up nearly 3%; institutions indicate clarity on the bottom of coal prices; sector dividend expectations stabilize

MONGOL MINING (00975) rose nearly 3%, with a 2.79% increase as of the time of writing, reaching 7.01 Hong Kong dollars, with a turnover of 86.155 million Hong Kong dollars. CITIC SEC released a research report pointing out that according to the statistical data of the National Bureau of Statistics, the total profits of the national scale coal mining and washing industry in the first 11 months of 2024 reached 564.05 billion yuan, a year-on-year decrease of 22.43%. Based on the statistics of the net profit of listed companies in the sample, it is expected that the net profit of the major coal mining listed companies tracked will decrease by 14.2% in 2024 (if we exclude China Shenhua Energy, which has a large market value proportion, the expected decline will be 20%), with the net profit growth rates of major companies in thermal coal/coking coal/bituminous coal being -7%/-45%/-59%, respectively. Based on the expected net profit in 2024 and assuming that the sample companies maintain the dividend rate level of 2023, the average dividend yield is expected to reach 5.1%, with approximately one-third of the companies in the current valuation having a dividend yield exceeding 6%. The bank pointed out that in the past two weeks, the leading companies in the coal sector have undergone noticeable adjustments, with significant adjustments mostly seen in targets with concentrated institutional holdings. However, in terms of the estimated performance expectations, the valuations and dividend levels of the leading companies still remain attractive. Once the bottom of the coal price becomes clear and dividend expectations stabilize, it is expected that the leading companies in the sector will continue to attract incremental funds with a dividend investing style. If the subsequent economic growth exceeds expectations, there may also be trading opportunities driven by expected improvements in the sector.