Morgan Stanley: MMG (01208) reaches production targets and maintains "outperform" rating.

Morgan Stanley released a research report stating that the copper concentrate production at Las Bambas, a subsidiary of MMG (01208), in the second quarter of this year was 109,000 tons, in line with the annual production guidance of 380,000 to 400,000 tons. The Khoemacau mine produced 22,000 tons in the first half of the year, accounting for approximately 42% to 46% of the annual guidance. Morgan Stanley expects production to increase in the second half of the year as equipment utilization rates improve, new mining equipment is put in place, and ore grades remain high. Morgan Stanley maintains a "hold" rating on MMG with a target price of HK$11.70, believing that the operational conditions at the mines will be relatively stable in the second half of the year, with Las Bambas production likely to reach the upper end of the annual guidance. With concerns about social stability easing after the Peruvian presidential election, improvements in production and costs are expected to continue to drive profit growth.