CMB International: YANCOAL AUS (03668) strong second quarter sales volume, target price raised to HK$39.

CMB International has released a research report stating that YANCOAL AUS (03668) is expected to see a 15% year-on-year growth in production in the second quarter of this year, with a 43% increase in sales volume. This is mainly due to the impact of a low base caused by delayed shipments last year, maintaining a "buy" rating, with a target price raised slightly from 38 Hong Kong dollars to 39 Hong Kong dollars. The long-term coal price forecast remains unchanged, with expectations that the hot summer in the northern hemisphere affected by the El Nio phenomenon can support thermal coal prices, while ongoing conflicts in the Middle East also provide support for energy prices. The bank predicts that Yancoal Australia's equipment utilization rate in the second quarter can remain at a high level, with a 5% year-on-year growth in total production in the first half of the year to 19.8 million tons, reaching 49% to 54% of the annual production target. The bank has raised its profit forecasts for Yancoal Australia in 2026 to 2028 by 55%, 14%, and 7%, mainly due to an increase in forecasts for the average selling price of thermal coal and metallurgical coal.