HK Stock Market Move | CMOC Group Limited (03993) declines more than 5% as Congo (Kinshasa) suspends cobalt exports for four months, HSBC lowers company's cobalt sales forecast.

CMOC Group Limited (03993) is currently down more than 5%, with a decrease of 4.72% as of the time of writing, at 5.25 Hong Kong dollars, with a market value of 1.76 billion Hong Kong dollars. On the news front, the government of the Democratic Republic of Congo announced a four-month suspension of cobalt exports on February 24, with the country's cobalt production accounting for 76% of the global total in 2024. A research report from HSBC pointed out that CMOC Group Limited is expected to produce around 114,000 tons of cobalt through its TFM and KFM projects in 2024. The company currently holds approximately 30,000 tons of cobalt inventory outside of the Democratic Republic of Congo through its trading subsidiary, which is expected to be sufficient to sustain sales for two to three months. Therefore, it is anticipated that the export ban will have a manageable impact on CMOC's profits in the second quarter of 2025. The bank believes that the operations of the TFM and KFM projects will continue as usual, with cobalt stored in the form of cobalt hydroxide on the mine site. Inventories may continue to accumulate and could reach 98,000 tons by the end of this year. HSBC Research maintains a "buy" rating for CMOC and has lowered its cobalt sales forecast for 2025 from 100,000 tons to 71,000 tons, resulting in an 8% and 9% decrease in profit forecasts for the next two years. The target price has been revised from 7.8 Hong Kong dollars to 7.2 Hong Kong dollars.