While global capital markets fix their gaze on the new energy and AI wave, a mining heavyweight deeply rooted in South China is quietly converting its resource advantages into astonishing profit momentum.

On September 22, Guangdong Rising Dabaoshan Copper Co., Ltd. officially submitted a main board listing application to the Hong Kong Stock Exchange, with CITIC Securities as sole sponsor.

The company is a leading polymetallic mining firm in South China, principally engaged in the exploration, mining, ore processing, comprehensive utilization, and sale of copper, sulfur, and other polymetallic mineral resources. Its sole mining asset, the Dabaoshan Mine, is a large-scale open-pit polymetallic mine. In the first half of 2026, the company's half-year profit surpassed its entire previous year — a remarkable display of profitability.

Now, this largest polymetallic mining company in South China is knocking on the door of international capital with its stunning earnings momentum.

But questions follow — how much of this explosive performance is the company's own doing, and how much is simply the cycle standing on its side?

A Single Mine Carries All Profits, First-Half Net Income of 976 Million Yuan Exceeds Full Year

Zhitong Finance observes that the investment value of Guangdong Rising Dabaoshan Copper is primarily rooted in its unique resource endowment.

The company's sole core asset, the Dabaoshan Mine, is located in the core area of the Nanling metallogenic belt, a state-planned mining zone and a key exploration area in Guangdong Province. It officially commenced production in 1996 and completed a strategic transformation in 2017, shifting from a single iron ore mining enterprise to a comprehensive mining company focused on copper, sulfur, and various associated metals.

In terms of capacity, the Dabaoshan Mine has an approved mining production scale of 3.3 million tonnes per year, supported by a specialized copper-sulfur concentrator with a processing capacity of 3.6 million tonnes per year. Its core products include copper concentrate, sulfur concentrate, and magnetite-sulfur concentrate, along with large-scale output of ancillary products such as stone materials.

According to Frost & Sullivan, in 2025 the company ranked first in South China for copper concentrate output and third nationwide for sulfur concentrate output. The total potential economic value of mineral resources retained in the mining area exceeds RMB 100 billion, with proven and controlled copper-sulfur mineral resources amounting to 91.31 million tonnes.

Leafing through the prospectus, it is not hard to see that Guangdong Rising Dabaoshan Copper has delivered particularly impressive results in recent years, earning the title of a "top student" in a cyclical industry.

From 2023 to 2025, revenue grew from 1.596 billion yuan to 2.193 billion yuan, while net profit surged from 348 million yuan to 849 million yuan, representing a three-year compound annual growth rate of 56.2%. By the first half of 2026, net profit shot up to 976 million yuan — earning more in six months than in the entire previous year.

Generally speaking, it is rare for a mining company to deliver such a report card. The industry is typically shaped by cyclical characteristics, with income statements prone to swinging wildly alongside copper and sulfur prices. Yet Guangdong Rising Dabaoshan Copper managed to accelerate profit growth for three consecutive years, with net profit growth reaching 160.3% in the first half of 2026 — truly eye-catching.

At the same time, the company's profitability has achieved a qualitative leap: gross margin climbed steadily from 44.1% in 2023 to 70.0% in the first half of 2026, while net margin jumped from 21.8% in 2023 to 52.7% in the first half of 2026.

This was mainly driven by two factors: first, product mix optimization — the gross margin of sulfur concentrate rose sharply from 29.7% in 2023 to 74.6% in the first half of 2026, surpassing copper concentrate for the first time to become the largest revenue source. Second, outstanding cost control — total cost of sales for the full years from 2023 to 2025 grew by only 3.1% cumulatively, far below the 37.4% cumulative revenue growth over the same period, demonstrating extremely strong cost management capabilities.

Alongside rapid revenue and net profit growth, the company's operating cash flow has been relatively robust. In the first half of 2026, net cash from operating activities reached 1.053 billion yuan, surging 144.3% year-on-year. Meanwhile, the company adopts a "payment before delivery" model, with receivables turnover days maintained at an extremely low level of 5.1 days over the long term, implying virtually no bad debt risk. This means profits have not remained trapped in receivables but have genuinely converted into cash.

Additionally, as of the end of June 2026, the company had no interest-bearing bank borrowings whatsoever, with the debt-to-asset ratio plunging from 42.5% in 2023 to 2.1%. Financial burden during the period was also significantly lightened, with financing costs of only 13.12 million yuan in the first half of 2026. Extremely low debt pressure greatly reduces interest erosion while leaving ample room for earnings retention, laying a solid financial foundation for continued shareholder returns and high dividend payouts.

From the above, one can see that the company's unique resource endowment, near-zero debt financial structure, and billion-yuan-level operating cash flow form a financial foundation that most mining companies would envy. However, it should be noted that the 70% gross margin is the product of a triple cycle resonance in copper, sulfur, and molybdenum, rather than a norm that transcends cycles.

The Copper-Sulfur Track Has a Long Runway, but Commodity Cycles Remain the Biggest Variable

Looking at industry trends, the copper-sulfur sector in which Guangdong Rising Dabaoshan Copper operates is ushering in historic development opportunities, and its investment logic may extend beyond short-term earnings elasticity.

From a fundamental perspective, copper is transforming from a traditional electrical metal into a strategic metal needed jointly by new energy, power grids, and AI computing infrastructure. New energy vehicles, wind and solar energy storage, data center liquid cooling, and grid upgrading continue to drive copper demand. On the supply side, however, global new copper mine exploration, environmental assessment, and production cycles are lengthy, with new capacity released slowly, global copper mine supply remaining tight, China's copper ore external dependence staying high, and high-quality domestic producing copper mines scarce.

Measured by metal content, China's copper concentrate market grew from approximately 7.5 million tonnes in 2021 to approximately 9.4 million tonnes in 2025, and is expected to reach approximately 11.3 million tonnes by 2030. Globally, constrained by long development cycles, high capital expenditure, and declining grades at producing mines, new copper supply growth is limited. Therefore, according to Frost & Sullivan, copper prices are expected to remain at relatively high levels over the next five years, projected to reach approximately RMB 110,552.9 per tonne by 2030.

As for sulfur concentrate, a basic raw material for the fertilizer and chemical industries, domestic environmental policies continue to tighten, small and medium-sized mines are gradually being phased out, and the supply of stable, high-quality sulfur feedstock remains persistently tight.

Driven by rigid demand from agricultural fertilizers, expanding applications in new energy materials, and the expansion of non-ferrous metal smelting, China's sulfur concentrate market is expected to grow from approximately 20.1 million tonnes in 2025 to approximately 22.8 million tonnes by 2030. At the same time, industry concentration continues to rise, and companies with resource endowments and operational efficiency will benefit. Furthermore, according to Frost & Sullivan, because sulfur produced as a byproduct of petroleum processing has prices significantly affected by international oil price fluctuations, prices are expected to remain elevated.

Although the development opportunities in the copper-sulfur industry are prominent, investors should also clearly recognize potential risks.

First, there is the risk of commodity price volatility. The company's performance is highly positively correlated with copper and sulfur prices. The profit explosion in the first half of 2026 was essentially the result of a triple cycle resonance of high copper prices, soaring sulfur prices, and strengthening molybdenum prices. It is historically rare for all three commodities to be at elevated price levels simultaneously. Once the price center of any one commodity falls back, pressure for mean reversion in gross margin will immediately emerge. Copper prices are simultaneously disturbed by multiple factors including Federal Reserve monetary policy, the strength of the US dollar, global macroeconomic conditions, and demand from real estate and new energy, resulting in extremely large price swings.

Second, there is the pressure of mine service life and reliance on a single mine. All of the company's revenue comes from this one mine in Shaoguan, and the mine's service life is approximately 13 years, with renewal approval of the mining license requiring continuous attention. Any operational interruption — whether from safety issues, environmental penalties, or approval delays — would impact the company's fundamentals. Without a second mine as a buffer, this is a structural vulnerability.

Beyond that, continuous investment is required for green mine upgrades, tailings management, and ecological restoration, creating long-term environmental remediation costs.

The energy transition lengthens the demand runway for copper, but the cyclical fluctuations of commodities will not disappear because of a long-term story. Guangdong Rising Dabaoshan Copper sits on scarce copper-sulfur resources and benefits from tight supply and rising industry concentration, giving it a clear growth logic. Yet single-mine dependence, mine service life, license renewal, and the risk of price resonance reversal caused by cyclical fluctuations remain constraints that cannot be ignored.

Conclusion

In summary, it is not difficult to see that Guangdong Rising Dabaoshan Copper's Hong Kong listing presents a highly attractive investment story, built on its astonishing resource endowment, strong profitability, healthy financial structure, and long-term industry prosperity. For investors, however, it remains necessary to distinguish between "the certainty of resource endowment" and "the uncertainty of metal prices." A mine's reserves are visible, but cycle turning points always require prudent judgment.