Yanzhou Coal Mining (1171): Set to benefit from domestic shortage


China Electricity Council said this year might be the foremost tightened one for the Chinese coal market since 2016.

China Electricity Council said China's north east region could also be facing a 37 million tons thermal coal shortage, and this year might be the foremost tightened one for the coal market since 2016.

Yanzhou Coal Mining (, a serious Chinese coal producer, reported last month that 3Q saleable coal production increased 20.0% on year to 26.86 million tons, up from 8.8% in 2Q and 4.4% in 1Q. it's worth to note that sales volume rose 26.1% to 36.19 million tons, the third consecutive quarter that sales growth has exceeded 20.0%, suggesting robust demand.

The company said last month that it plans to extend its 2020-2024 cash dividend ratio, with total cash dividends in each financial year accounting for about 50% of its net income for the year after deducting statutory reserves, and therefore the cash dividend per share shall not be but 0.50 yuan (nearly 10% dividend yield at current share price level).

From a technical point of view, Yanzhou Coal Mining ( is gathering more upside momentum as shown on the daily chart. it's broken above a bearish channel drawn from July, while the 20-day moving average has crossed above the 50-day one. the extent at $5.70 could be considered because the nearest support, while the first and 2nd resistance are expected to be located at $6.55 and $7.00 respectively.

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