[ET Net News Agency, 8 August 2019] Daiwa Research initiated coverage on China
Molybdenum (CMOC)(03993) with an "outperform" rating and a target price of HK$2.75.
Due to oversupply in the cobalt market, CMOC's share price declined by more than 60%
from its peak in 2018, and the research house now sees an attractive entry point for
investors.
Daiwa prefers cobalt over lithium, as it expects the cobalt industry to re-enter a
supply deficit in 2020 and lithium to remain in severe supply surplus. Also, the cobalt
price is below the incentive price, whereas the lithium price is 50% above the cost of
production. (KL)