Securities Analysis: Shenhua will be profitable next year

China Shenhua (1088) reported that the coal production and marketing rate in June 09 was 18.3 million and 22.2 million tons respectively, increasing by 21.1% and 16.8% respectively in the year. Sales increased by 0.3% to 7.44 billion kwh per year. 　　The coal production and sales rate grew slightly from May, while sales in June also increased by a year. In the first 6 months, coal production and marketing rates grew by 17.6% and 7% to 105.8 million and 123.1 million tonnes respectively, equivalent to 53.7% and 56% of the company's full-year goals. Sales are down 8.2% to 40.34 billion kwh per year, equivalent to 46.3% of the full-year target. Starting from March this year, the company's operating conditions continue to improve. 　　Given the increase in economic activity in the second half of the year, the likelihood of a company accomplishing its full-year goals is high. 1th quarter of the company's sales to achieve the price of 4.8% per year. The company's management said the price of the contract coal had been signed in 09 and the price was 12.9% per year. 5,500-card contract coal price of 540 yuan per ton, and the current Qinhuangdao per ton of 550 yuan of RMB price is similar. 　　The bank believes the company's medium-term results will be stronger, driven mainly by sales and contract prices. 　　The bank expects 2009 and 2010 earnings to be 30.38 billion yuan (1.52 yuan per share) and 32.4 billion yuan (earnings per share of 1.62 yuan), with annual growth of 14% and 6.6%. The current equivalent of 2009 and 2010 earnings multiples of 15.6 and 14.6 times times, the bank said China Shenhua's valuation attracted. Rising oil prices will be a stimulus to short-term stock prices. Maintain the Buy rating, and the 12-month target price is raised to 29.5 yuan, equivalent to 16 times times the 2010 earnings ratio.