Project ahead of schedule, capacity release exceeds expectations
On July 28, 2026, Zijin Mining Group Co., Ltd. (601899.SH, 2899.HK) announced that its Timok copper-gold mine in Serbia has officially entered commercial production, approximately three months ahead of the original plan. The mine is Zijin Mining's largest single investment project in the Balkan region, with a designed annual ore processing capacity of 3.3 million tons. After reaching full production, it is expected to produce about 90,000 tons of copper in copper concentrate and about 5 tons of gold in gold concentrate annually, becoming a new profit growth driver for the company.
Zijin Mining Chairman Chen Jinghe stated in the announcement: "The successful production of the Timok project is an important milestone in the company's globalization strategy. Serbia has a favorable mining investment environment and infrastructure. The mine will adopt the most advanced environmental protection technologies to achieve green development." It is reported that the Timok mine has high copper and gold grades, with an average gold grade of 1.5 g/t, and associated precious metals such as silver, with a comprehensive recovery rate exceeding 90%.
CICC significantly raises target price
Following the news of the early production, CICC immediately issued a research report, maintaining a "buy" rating on Zijin Mining and raising the A-share target price from RMB 16.5 to RMB 18, and the H-share target price from HKD 15.8 to HKD 17.5. Analysts pointed out that the early production of the Timok mine will directly boost the company's performance in the second half of 2026, with full-year gold production expected to exceed 60 tons and copper production reaching 1.1 million tons, both hitting record highs.
The CICC report also emphasized that the operational efficiency of Zijin Mining's producing mines in Africa and South America continues to improve, coupled with gold prices remaining high (current international gold price about USD 2,420 per ounce), the company's profit elasticity is enormous. Based on 2026 consensus estimates, Zijin Mining's current H-share valuation is only 12 times price-to-earnings ratio, lower than the international peer Newmont's 15 times, indicating significant valuation recovery potential.
Asian gold mining industry overall recovery
The success of the Timok project is a microcosm of the Asian gold mining industry. In the first half of 2026, driven by factors such as continued central bank gold purchases and geopolitical uncertainties, gold prices fluctuated in the range of USD 2,300-2,500 per ounce. Against this backdrop, major Asian gold producers have accelerated expansion.
- Indonesia's PT Aneka Tambang (ANTM): Second-quarter gold production increased 15% year-on-year, and announced the launch of an expansion project at the East Java gold mine.
- Japan's Sumitomo Metal Mining (SMM): Through technological transformation, its Hishikari gold mine raised the grade to 40 g/t, with annual production stabilized at around 7 tons.
- Korea Zinc: Leveraging by-product recovery, first-half gold production increased 8% year-on-year.
Institutional investor attention to Asian gold mining stocks is also heating up. Morgan Stanley's latest report upgraded the Asian gold mining industry rating from "neutral" to "overweight," believing that miners in the region have better cost control than global peers and benefit from growing emerging market demand.
Zijin Mining's overseas expansion deepens
In addition to the Serbia project, Zijin Mining has recently made progress in South America and Africa. In June 2026, the company completed the acquisition of the 3Q salt lake lithium mine in Argentina, further expanding its new energy minerals portfolio. However, gold remains its core business, contributing about 45% of the company's gross profit.
Analysts caution that while the early production of the Timok mine is positive, investors still need to monitor local policy risks in Serbia and the possibility of gold price corrections. Zijin Mining's H-shares closed at HKD 16.8 today, up 3.7%, and A-shares at RMB 17.2, up 2.9%.
Outlook: Gold price and production dual drivers
Looking ahead to the second half of the year, the market generally expects the Federal Reserve to enter an interest rate cut cycle, and falling real interest rates will provide strong support for gold prices. CICC expects the average gold price in 2026 to be USD 2,400 per ounce, potentially hitting USD 2,600 in the fourth quarter. For a production growth company like Zijin Mining, every USD 100 increase in gold price boosts net profit by about RMB 1.5 billion.
In summary, the early production of Zijin Mining's Timok project not only brings earnings increments to the company itself but also reflects the overall expansion vitality of the Asian gold mining industry. With precious metals' allocation value highlighted, Asian mining companies are expected to continue attracting global capital attention through cost advantages and resource endowments. Investors can share in the industry's dividends by holding relevant stocks or ETFs (such as GLD, IAU, etc.), but should pay attention to risk diversification.
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