CICC Raises CGN Target Price 53% to HK$4.80
On March 30, the investment bank CICC maintained its "outperform" rating for CGN Mining (01164) but boosted its price target by a substantial 53% to HK$4.80. The new target suggests a 21% potential upside from the current share price and values the company at 34.9 times its estimated 2026 earnings. CICC's bullish revision reflects its confidence in the natural uranium sector, which is experiencing tight supply-demand dynamics and geopolitical constraints that are pushing long-term contract prices higher. In February 2026, the average long-term contract price for uranium reached $90 per pound, its highest level since 2008.
2025 Profit Rose 32% Despite Trading Loss
The optimistic forecast follows CGN Mining's 2025 financial results, which presented a mixed but ultimately positive picture. While revenue fell 20% year-over-year to HK$68.7 billion, net profit attributable to shareholders grew an impressive 32% to HK$453 million. The company's net profit fell short of CICC's initial expectations primarily because of a cost inversion in its trading business, where the average cost of uranium sold ($74.0 per pound) exceeded the average sale price ($71.8 per pound). This short-term trading headwind was overshadowed by the underlying strength in its core production assets.
Production Growth Set to Capture Higher Uranium Prices
CGN Mining is well-positioned to capitalize on the strong uranium market as it prepares to bring its Zha Kuang mine into production in 2026. This new output is expected to drive a 7% year-over-year increase in the company's equity production to 1,387 tU for 2026. Reflecting this growth and higher anticipated prices, CICC raised its 2026 net profit forecast for the company by 5% to HK$1.05 billion and introduced a 2027 forecast of HK$1.17 billion. The company's execution on production provides a clear contrast to some industry peers that have faced operational delays, strengthening its position in a capacity-constrained global market.
