$YANKUANG ENERGY (01171.HK)$ KGI has a TA target of HKD29.20...

KGI has a TA target of HKD29.20.

Yankuang Energy Group Co Ltd is a China-based international comprehensive energy company engaged in coal and coal chemical industry. The Company operates in 5 segments. The Coal Mining segment is engaged in underground and open-cut mining, preparation and sale of coal and potash mineral exploration. The Smart Logistics segment provides railway transportation services. The Electricity and Heating Supply segment provides electricity and related heat supply services. The Equipment Manufacturing segment is engaged in the manufacture of comprehensive coal mining and excavating equipment. The Chemical Products segment is engaged in the production and sale of chemical products. The coal products mainly include thermal coal, pulverized coal injection (PCI), and coking coal. The coal chemical products mainly include methanol, ethylene glycol, acetic acid, ethyl acetate and crude liquid wax, among others. The Company distributes products in the domestic market and to overseas markets.

China's coal imports have almost doubled in the first quarter of this year as its manufacturing sector got back into full swing following the pandemic. China's consumption of coal is expected to pick up following the reopening of its economy from strict zero-COVID measures, supporting its activities such as railway maintenance, as well as to cater to the EV boom within China.

China has called on coal-producing regions and enterprises to accelerate adoption of so-called 'smart-mining' technologies, replacing human labour with unmanned mining vehicles controlled remotely from above-ground data centres. China has installed the technology at more than 1,000 working coal faces as part of this initiative, representing more than 620 m tonnes of annual coal production capacity.

FY22 estimated earnings. The company expects to realise a net profit attributable to the shareholders of about RMB30,800 m, an increase of about RMB14,500 m or approximately 89% YoY, from RMB16,259 m in FY21.

Consensus tp is HKD27.78.