西部矿业估值模型

1、Project Dragonboat - Preliminary Valuation Resultsfor CICC internal cc meetingFree cash flow to firmRMB000200620072008200920102011EBIT*(1-T)2,161,6043,880,0112,934,3171,907,1371,764,3181,133,316Depreciation & Amortization208,073394,875491,993521,001540,051540,015Changes in working capital(511,75

2、4)(597,654)440,511428,84647,768109,876Capital expenditure(901,763)(1,284,443)(893,691)(252,113)(168,213)(104,642)Free cash flow to firm956,1612,392,7902,973,1312,604,8722,183,9241,678,565Valuation Date: mm beginning, 20074discount adjust factor0.251.252.253.254.25offering %30%DCF valuationDiscount r

3、ate10%12%14%Perpetual Growth Rate0%PV of 2006-2011 FCFF9,343,3798,951,1098,586,442PV of Terminal Value11,194,8778,641,3266,870,124Enterprise Value20,538,25617,592,43515,456,566Net Debt2,188,533Minority Interest409,933Pre-money Equity Value17,939,79014,993,96912,858,100Post-money Equity Value25,628,2

4、7221,419,95518,368,715Implied PE-078.7x7.3x6.2xEV/EBITDA5.3x4.5x4.0 xValuationDCFPEEV/EBITDAPBNet income 20072,941,628EBITDA 20074,564,718Multiple/WACC14%10%6.0 x8.0 x3.0 x4.5x2.0 x2.5xEnterprise Value15,456,56620,538,25613,694,15520,541,232Pre-money Equity Value12,858,10017,939,79011,095,68917,942,

5、7663,392,359Post-money Equity Value18,368,71525,628,27217,649,76923,533,02615,850,98425,632,52316,961,79733,923,593Profit sensitivity to Metal Price-20%-10%-1%0%1%10%20%Zinc22,40525,20527,72628,00628,28630,80633,607Net profit - 20072,545,2382,743,4332,921,8092,941,6282,961,4483,139,8233,338,019%-13.

6、5%-6.7%-0.7%0.0%0.7%6.7%13.5%Lead9,08010,21511,23611,35011,46312,48513,619Net profit - 20072,792,8172,867,3762,934,4792,941,6282,948,7683,013,0303,084,431%-5.1%-2.5%-0.2%0.0%0.2%2.4%4.9%Copper31,70735,67039,23839,63440,03043,59747,561Net profit - 20072,793,4862,867,5572,934,2212,941,6282,949,0353,01

7、5,6993,089,771%-5.0%-2.5%-0.3%0.0%0.3%2.5%5.0%Aluminum12,71614,30515,73615,89516,05417,48419,074Net profit - 20072,817,2422,879,4352,935,4092,941,6282,947,8483,003,8213,066,015%-4.2%-2.1%-0.2%0.0%0.2%2.1%4.2%WACC calculationWACC sensitivity analysisCapital structureReleveredCost of debtD/ED/(D+E)bet

8、aPre-taxPost-tax(%)(%)(x)(%)(%)0.00%0.00%1.006.12%5.20%10.00%9.09%1.096.12%5.20%20.00%16.67%1.176.12%5.20%30.00%23.08%1.266.12%5.20%40.00%28.57%1.346.12%5.20%50.00%33.33%1.436.12%5.20%60.00%37.50%1.516.12%5.20%70.00%41.18%1.606.12%5.20%80.00%44.44%1.686.12%5.20%90.00%47.37%1.776.12%5.20%Key assumpti

9、ons (US)Unlevered beta 1.00Marginal tax rate15.0%Risk free rate (CH 10 year bond)4.65%Debt cost6.12%Market return11.30%Market risk premium (Bloomberg)6.7%Ungeared BetaMarket capTax rateDebtEquity BVD/Eadj-BetaDomestic listed zinc producer驰宏锌锗1,27319.7%20992226%1.16四川宏达87918.2%353127279%1.23中金岭南1,405

10、16.2%486285170%1.26HK listed China non-ferrous metal producer中国铝业8,82325.6%3,1804,18576%1.30江西铜业2,97413.6%5561,06852%1.47湖南有色2,00720.0%875249352%1.54Global pure play lead-zinc producerBoliden Ab7,25325.4%1,9091,97497%1.20Zinifex7,15311.0%6611,73438%1.91Hudbay Minerals Inc.1,6089.5%33268948%2.12Lundi

11、n Mining Corp.1,41624.2%19635056%1.67Kagara Zinc Ltd.1,00431.1%11472159%1.88Perilya Ltd.65331.4%166103160%2.18Global diversified base metal producerTeck Cominco Ltd. (ClB)15,73439.3%3,5365,03570%1.94Vedanta Resources Plc7,15830.0%4,0261,417284%1.92Volcan Compania Minera Sa B1,87030.9%320267120%1.61M

12、edianChosen unlevered BetaCost of equityCost of capital(%)(%)11.30%11.30%11.87%11.26%12.43%11.23%13.00%11.20%13.56%11.17%14.13%11.15%14.69%11.13%15.26%11.12%15.82%11.10%16.39%11.09%Unlevd. Beta0.410.370.520.831.010.400.701.431.481.170.901.041.360.640.880.881.00Western Mining Operational and Financia

13、l Information(Forecast are from CICC financial model)HistoricalForecast200320042005200620072008200920102011Price and ProductionTonnage, RMB / tPriceZinc6,5338,25210,83025,59028,00619,98513,24512,32710,496Lead3,9546,8767,5648,93911,3509,7715,8876,2595,842Copper13,75322,34928,70941,89139,63429,49225,2

14、6221,10121,928MineLead concentrate56,93758,43463,85958,64772,01976,49676,63374,30470,539Zinc concentrate70,02064,27574,15273,40285,40691,22991,10187,50784,776Copper concentrate2,31911,96418,59923,94324,61525,06025,33624,78725,368Sulfuric concentrate37,63440,41281,79595,00095,00095,00095,00095,00095,

15、000Contained gold0.20.30.30.20.20.20.20.30.3Contained silver60.461.071.057.060.060.560.658.455.3SmelterCrude lead4,036-50,00050,000105,000105,000105,000Electrolytic lead3,7831,0606,76520,00040,00050,000105,000105,000105,000Vitriol-2169,25112,500125,800235,800425,300425,300425,300Electrolytic zinc1,9

16、259,19930,7527,25039,00094,000164,000164,000164,000Zinc oxide-939-4,00012,80016,00016,00016,000Alumium-94,39495,000106,000110,000110,000110,000110,000Financial InformationRMB000Revenue926,1041,325,5254,178,5185,602,2227,567,7477,526,6407,026,4536,697,6046,099,312EBITDA237,483546,412951,6972,543,0644

17、,564,7183,452,1372,243,6912,075,6681,691,516Financing cost27,61170,087140,577187,320192,022178,922166,900142,735123,231Net profit135,275307,335524,3311,838,8202,941,6282,064,7591,087,852955,580724,391Total asset1,598,3144,210,3216,746,3809,521,00315,557,97917,523,65018,331,60018,665,92718,960,702Tot

18、al debt772,4002,299,5163,617,4904,594,7133,852,0903,824,7223,451,3543,019,2152,801,225Cash219,442555,000787,5532,406,1806,904,9668,482,5059,724,40510,539,09011,466,675Total liabilities1,049,5502,828,4194,792,8635,718,7105,027,0575,426,6355,317,0514,824,1604,518,610Minority interets168,347254,622401,

19、906409,933873,5861,200,8241,465,6461,719,5171,885,207Shareholders Equity380,4171,127,2801,551,6113,392,3599,657,33610,896,19111,548,90212,122,25012,556,885ROE35.6%27.3%33.8%54.2%30.5%18.9%9.4%7.9%5.8%ROA8.5%7.3%7.8%19.3%18.9%11.8%5.9%5.1%3.8%ROIC13.5%11.0%12.4%23.8%25.8%17.5%10.7%9.7%7.7%Net Profit

20、margin15%23%13%33%39%27%15%14%12%EBITDA margin26%41%23%45%60%46%32%31%28%Debt / Total capital58%62%65%55%27%24%21%18%16%Debt / EBITDA3.34.23.81.80.81.11.51.51.7EBITDA coverage8.67.86.813.623.819.313.414.513.7西西部部矿矿业业股股份份有有限限公公司司 Western Mining Co., Ltd龙龙舟舟项项目目估估值值模模型型 Project Dragon Boat Valuation M

21、odel年年度度截截止止12月月31日日 Year ending 31 December2006200720082009201020112012201320142015201620172018201920202021202220232024202520262027202820292030Price assumptions123Selected price set (nominal)1NameZinc:RMB/tZn_Price25,590.0028,005.7019,985.2313,244.9412,326.5710,496.0710,810.9511,135.2811,469.3411,8

22、13.4212,167.8212,532.8512,908.8413,296.1013,694.9914,105.8414,529.0114,964.8815,413.8315,876.2416,352.5316,843.1117,348.4017,868.8518,404.92Lead:RMB/tPb_Price8,939.0011,349.579,770.895,886.526,258.955,841.586,016.836,197.336,383.256,574.756,771.996,975.157,184.417,399.947,621.947,850.608,086.128,328

23、.708,578.568,835.929,100.999,374.029,655.259,944.9010,243.25Copper:RMB/tCu_Price41,891.2139,633.8629,491.9225,262.2121,101.2421,928.4422,586.2923,263.8823,961.7924,680.6525,421.0726,183.7026,969.2127,778.2928,611.6429,469.9930,354.0831,264.7132,202.6533,168.7334,163.7935,188.7036,244.3637,331.7038,4

24、51.65Gold:RMB/gAu_Price107.00123.60116.70109.27112.55104.33107.46110.69114.01117.43120.95124.58128.32132.17136.13140.22144.42148.76153.22157.82162.55167.43172.45177.62182.95Silver:RMB/gAg_Price1.912.101.691.551.601.441.481.531.571.621.671.721.771.821.881.931.992.052.112.172.242.312.382.452.52Sulfuri

25、c acid:RMB/tSCon_Price19.8520.6021.2221.8522.5123.1923.8824.6025.3426.1026.8827.6828.5229.3730.2531.1632.0933.0634.0535.0736.1237.2138.3239.4740.66Zinc Oxide:RMB/tZO_Price27,337.0025,885.9618,436.3212,286.6211,504.959,819.0510,113.6210,417.0310,729.5411,051.4311,382.9711,724.4612,076.1912,438.4812,8

26、11.6313,195.9813,591.8613,999.6214,419.6114,852.2015,297.7615,756.7016,229.4016,716.2817,217.77Alumium:RMB/tAl_Price17,678.5115,894.9613,632.5713,883.1013,970.9413,711.8914,123.2514,546.9514,983.3615,432.8615,895.8416,372.7216,863.9017,369.8217,890.9118,427.6418,980.4719,549.8820,136.3820,740.4721,3

27、62.6822,003.5622,663.6723,343.5824,043.89Alumina:RMB/tAla_Price5,110.312,067.552,051.621,874.301,844.751,827.021,881.831,938.281,996.432,056.322,118.012,181.552,247.002,314.412,383.842,455.362,529.022,604.892,683.032,763.532,846.432,931.823,019.783,110.373,203.681Management assumptions price set (re

28、al)Zinc:RMB/t25,590.0027,190.0018,838.0012,121.0010,952.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.009,054.00Lead:RMB/t8,939.0011,019.009,210.005,387.005,561.005,039.005,039.005,039.005,039.0

29、05,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.005,039.00Copper:RMB/t41,891.2138,479.4827,798.9723,118.5018,748.1818,915.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915

30、.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915.6618,915.66Gold:RMB/g107.00120.00110.00100.00100.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.0090.00Silver:RMB/g1.912.041.591.421.421.241.241.241.241.241.241.241.241.241.241.241.241.241.241.241.

31、241.241.241.241.24Sulfuric acid:RMB/t19.8520.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.0020.00Zinc Oxide:RMB/t27,337.0025,132.0017,378.0011,244.0010,222.008,470.008,470.008,470.008,470.008,470.008,470.008,470.008,470.008,470.008,470

32、.008,470.008,470.008,470.008,470.008,470.008,470.008,470.008,470.008,470.008,470.00Alumium:RMB/t17,678.5115,432.0012,850.0012,705.0012,413.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828.0011,828

33、.0011,828.0011,828.00Alumina:RMB/t5,110.312,007.331,933.851,715.251,639.041,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.001,576.002Broker consensus price setZinc:RMB/t23,743.4524,977.2717,303.5311

34、,938.9811,893.9410,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.5910,489.59Lead:RMB/t9,396.488,715.956,856.965,305.885,858.605,443.785,443.785,443.785,443.785,443.785,443.785,443.

35、785,443.785,443.785,443.785,443.785,443.785,443.785,443.785,443.785,443.785,443.785,443.785,443.785,443.78Copper:RMB/t53,501.2349,331.1936,971.5228,447.1925,192.2220,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420,586.1420

36、,586.1420,586.1420,586.1420,586.1420,586.14Gold:RMB/g168.55186.40178.93148.40137.45127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39127.39Silver:RMB/g3.163.563.232.582.512.012.012.012.012.012.012.012.012.012.012.012.012.012.012.012.012

37、.012.012.012.01Sulfuric acid (adopt managements assumption set):RMB/tZinc Oxide:RMB/tAlumium:RMB/t19,736.6017,980.0715,536.1114,835.6114,733.0614,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,255.7514,2

38、55.7514,255.7514,255.75Alumina:RMB/t3,723.202,349.752,275.002,019.512,334.261,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.001,859.003CICC price set (nominal)Zinc:RMB/t23,128.7024,074.4810,317.638,

39、598.0311,005.489,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.879,285.87Lead:RMB/t9,457.837,927.387,394.304,127.055,158.824,986.864,986.864,986.864,986.864,986.864,986.864,986.864,986.864,986.864,9

40、86.864,986.864,986.864,986.864,986.864,986.864,986.864,986.864,986.864,986.864,986.86Copper:RMB/t55,027.3842,130.3434,392.1124,074.4825,450.1619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,775.4619,77

41、5.4619,775.4619,775.46Gold:RMB/g163.70178.84162.33151.32129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09129.09Silver:RMB/g3.303.302.482.371.921.921.921.921.921.921.921.921.921.921.921.921.921.921.921.921.921.921.921.921.92Sulfur

42、ic acid (adopt managements assumption set):RMB/t3.163.563.232.582.512.012.012.012.012.012.012.012.012.012.012.012.012.012.012.012.012.012.012.012.01Zinc Oxide:RMB/tAlumium:RMB/t19,947.4318,915.6617,368.0214,616.6513,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412

43、.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.9213,412.92Alumina:RMB/t440.00220.00250.00300.00320.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00260.00TC/RC assumptionsZinc:RMB/tZn_TC6,3

44、987,0014,9963,3113,0822,6242,7032,7842,8672,9533,0423,1333,2273,3243,4243,5263,6323,7413,8533,9694,0884,2114,3374,4674,601as of zinc price%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%25%Lead:RMB/tPb_TC1,7882,2701,9541,1771,2521,1681,2031,2391,2771,3151,3541,3951,4371,4801

45、,5241,5701,6171,6661,7161,7671,8201,8751,9311,9892,049as of lead price%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%20%Conversion ratiosgrams to oz0.0353g_to_oztons (metric) to oz 32,000st_to_oztonnes to oz35,274t_to_ozkg to oz35.2740kg_to_oztonnes to lbs2,204.62t_to_lbsto

46、nnes to grams1,000,000.00t_to_gRMB000 to RMB1,000.00r000_to_rkg to g1,000.00kg_to_gExchange rates:RMBUSDRMB7.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.807.80Discount factorDiscount rate2Selected case12.00%1Low10.00%2Base12.00%3High14.00%Timing of cas

47、h flows1Selected caseMid-year-0.51.52.53.54.55.56.57.58.59.510.511.512.513.514.515.516.517.518.519.520.521.522.523.51Mid-year:units0.51.52.53.54.55.56.57.58.59.510.511.512.513.514.515.516.517.518.519.520.521.522.523.52End-of-year:units1.02.03.04.05.06.07.08.09.010.011.012.013.014.015.016.017.018.019

48、.020.021.022.023.024.0Discount factor:unitsDisc_factor1.000.940.840.750.670.600.540.480.430.380.340.300.270.240.220.190.170.150.140.120.110.100.090.080.07Tax rateTax rate applied:%Tax_rate15%15%15%15%15%33%33%33%33%33%33%33%33%33%33%33%33%33%33%33%33%33%33%33%33%DaysNumber of operating days365 daysO

49、p_daysDays debtors15 daysDays inventory20 daysDays creditors15 daysInflationChina cost inflation index:unitsChina_inflation_index1.001.031.061.091.131.161.191.231.271.301.341.381.431.471.511.561.601.651.701.751.811.861.921.972.03New issue proceeds4,500,000Payout ratio%40%Payoff short-term loan by pr

50、oceeds:RMB0001,000,000Sum of capex:RMB000901,7631,284,443893,691252,113168,213104,64278,47078,47078,47078,47064,20064,20064,20064,20064,20064,20064,20019,26019,26019,26019,260-Mine:RMB000451,634441,643391,591238,823154,52391,15264,98064,98064,98064,98064,20064,20064,20064,20064,20064,20064,20019,260

51、19,26019,26019,2600000Smelter:RMB000189,129547,800447,10013,29013,69013,49013,49013,49013,49013,490-Xihai Power branch:RMB000261,000295,00055,000-New borrowings%50%Balance of long term debt1,025,6001,282,9771,255,609882,241450,102232,112121,63492,67981,08778,47079,18287,741104,1470new borrowings:RMB

52、000642,221446,845126,05784,10752,32139,23539,23539,23539,23532,10032,10032,10032,10032,100payment scheduleyears5西西部部矿矿业业股股份份有有限限公公司司 Western Mining Co., Ltd龙龙舟舟项项目目估估值值模模型型 Project Dragon Boat Valuation Model年年度度截截止止12月月31日日 Year ending 31 December2006200720082009201020112012201320142015201620172018

53、201920202021202220232024202520262027202820292030interest rate%6%interest bearing:RMB00069,22869,25776,15864,13539,97020,46610,6126,4295,2134,787Balance of short term debt:RMB0003,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,

54、1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,1132,569,113new borrowings:RMB0001,233,623-interest rete%4%interest bearing:RMB000118,092122,765102,765102,765102,765102,765102,765102,765102,765102,765102,765102,765102,765102,765102,765102,765102,765102,76510

55、2,765102,765102,765102,765102,765102,765102,765SegmentationXitieshanreserve:t23,210,000resource:t140,000conversion -%0%ore production:t1,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,0001,4

56、50,0001,450,0001,450,0001,450,0001,450,0001,450,0001,450,000unit cash cost - rmb/tonmining:RMB/t86868686868699999999114114114114114131131milling:RMB/t6767676767676767676767676767676767SG&A:RMB/t1919191919191919191919191919191919capex:RMB00048,860104,940119,94084,94044,94044,94044,94044,94044,940

57、44,94044,94044,94044,94044,94044,94044,94044,940Huogeqireserve:t10,820,000resource:t27,040,000conversion -%0%capacity:t1,500,0001,500,0001,500,0001,500,0001,500,0001,500,0002,000,0002,300,0002,600,0003,000,000unit cash costmining:RMB/t56575753565665656565milling:RMB/t59626360585563636363SG&A:RMB

58、/t33312924233030303030capex:RMB000231,109274,253215,28389,89389,89326,172-Gacunreserve:t4,037,000resource:t3,758,000conversion -%0%capacity:t62,500300,000500,000500,000500,000500,000500,000500,000500,000500,000unit cash costmining:RMB/t74747474747485858585milling:RMB/t144145140140140140161161161161S

59、G&A:RMB/t236235204181179173173173173173capex:RMB000134,784740750760770780780780780780Saishitangreserve:t11,820,000resource:t18,570,000conversion -%0%capacity:t500,000500,000650,000750,000750,000750,000750,000750,000750,000750,000750,000750,000750,000750,000750,000750,000750,000750,000750,000750,

60、000750,000unit cash cost - rmb/tonmining:RMB/t373737373737434343434343434343434343434343milling:RMB/t434747474848555555555555555555555555555555SG&A:RMB/t545752495051515151515151515151515151515151capex:RMB00036,88161,71055,61863,23018,92019,26019,26019,26019,26019,26019,26019,26019,26019,26019,26019,26019,26019,26