"Zijin System" Takes Control: First Perfect Score? Zangge Mining Posts Double Growth in Revenue and Profit Last Year, with 70% of Profits Supported by Copper Mine Investment Returns

Source: Times Weekly Report Author: Yu Chen, Intern Cao Yu

Zangge Mining (000408.SZ) has received its first annual report after Zijin Mining (601899.SH) officially took control.

On the evening of March 13, Zangge Mining disclosed its 2025 annual report. The report shows that last year, the company achieved operating revenue of 3.577 billion yuan, a year-on-year increase of 10.03%; net profit attributable to shareholders of the parent company was 3.852 billion yuan, up 49.32%; and net profit after deducting non-recurring gains and losses was 4.031 billion yuan, up 58.28%.

Quarterly, in Q4 2025, the company achieved operating revenue of 1.175 billion yuan, a 26.76% increase; net profit attributable to shareholders was 1.102 billion yuan, up 54.7%.

Overall, Zangge Mining’s net profit attributable to shareholders in 2025 grew significantly faster than revenue, with investment income becoming an important source of profit. During the reporting period, the company’s investment in Tibet Julong Copper Co., Ltd. (hereinafter “Julong Copper”) contributed 2.782 billion yuan in investment income, accounting for about 72.23% of the net profit attributable to shareholders.

In its previous performance forecast, Zangge Mining attributed its growth to three factors: first, the potassium chloride business exceeded expectations in production and sales; second, the lithium carbonate prices rebounded in Q4, partially offsetting losses from production halts; third, the company’s stake in Julong Copper benefited from rising copper prices and capacity releases, bringing substantial investment income.

Potash business steady, lithium carbonate under pressure

Founded in 2002, Zangge Mining went public via a backdoor listing in 2016. The company started with potash fertilizer and entered the lithium battery materials sector in 2017, gradually forming a “dual-drive” industry layout of potassium and lithium. Currently, its main businesses are the research, production, and sales of potassium chloride and lithium carbonate, with products widely used in agriculture, new energy vehicles, energy storage, and consumer electronics.

Relying on the 724.35-square-kilometer salt lake mining rights in Qarhan Salt Lake, Qinghai, Zangge Mining produces potassium chloride through solid-to-liquid conversion technology and produces battery-grade lithium carbonate from brine using salt lake lithium extraction technology. As of the end of the report period, the company’s designed capacity for potassium chloride was 1.2 million tons per year, with an utilization rate of 86.10%; for battery-grade lithium carbonate, the designed capacity was 10,000 tons per year, with an utilization rate of 88.08%, and under-construction capacity of 50,000 tons per year.

In terms of revenue structure, potassium chloride remains the main source, accounting for over 80%. The annual report shows that in 2025, sales revenue from potassium chloride was 2.949 billion yuan, up 33.42%. Benefiting from improved market supply and demand, the average selling price of potassium chloride was 2,964.28 yuan per ton, up 28.57%.

In contrast, the lithium carbonate business faced overall pressure. In 2025, revenue from lithium carbonate was 593 million yuan, accounting for 16.57% of total revenue, down 41.98% year-on-year; gross profit margin was only 34.82%, down 10.62 percentage points.

This change is related to the lithium carbonate production halt and industry cycle fluctuations experienced over the past year. On July 16, 2025, the Haixi Natural Resources Department required Zangge Potash to suspend lithium extraction from tail brine and conduct compliance self-inspection. After completing the procedures, the company resumed production on October 11, 2025.

However, lithium prices rebounded in Q4 2025, partially offsetting the negative impact of the halt.

On March 13, TrendForce analyst Zeng Youpeng told Times Weekly that since the second half of 2025, with global energy storage demand exceeding expectations, the supply-demand relationship for upstream lithium battery materials has gradually shifted toward a tight balance, pushing lithium carbonate prices to bottom out and rebound.

“Lithium carbonate demand growth is expected to be around 30% in 2026,” Zeng said. Despite new capacity additions in 2026, most of the supply increase is expected in the second half, and supply-side uncertainties are increasing. During peak demand seasons, supply and demand may continue to push prices upward.

Li Pan, an analyst at Shanghai Steel Union New Energy Business Unit, also said that lithium carbonate prices are currently in a “V-shaped reversal” rebound phase. The market logic has shifted from “oversupply” to “tight supply and demand,” with the price center significantly higher than the 2025 lows. It is expected that the lithium carbonate price center will remain around 150,000 yuan per ton in 2026.

The annual report also shows that Zangge Mining’s Tibet Mami Cuo Salt Lake project entered substantive construction in 2025. The project is expected to be fully operational by the third quarter of 2026, with annual lithium carbonate production reaching 20,000 to 25,000 tons. Amid lithium price fluctuations, Li Pan noted that the salt lake project, with its extremely low cost curve, demonstrates greater resilience in industry reshuffling and becomes a “rigid supply” in the market.

Zeng Youpeng stated that the core competitiveness of upstream lithium resource companies mainly lies in resource reserves and quality, mining and lithium extraction costs, industry chain coordination and integration, as well as supply chain security and financing capabilities.

“Zijin Group’s Entry, Top Copper Resources Included

Industry experts generally believe that Zijin Group’s entry will further enhance Zangge Mining’s core competitiveness.

Wu Jianhui, Chairman of Zangge Mining, said in the 2025 annual report letter to shareholders that the company’s official joining Zijin Mining Group has brought about a historic change in governance structure.

On January 16, 2025, Zijin Mining, through its wholly owned subsidiary Zijin International Holdings Limited (“Zijin International”), acquired a 24.82% stake in Zangge Mining at 35 yuan per share, totaling 13.729 billion yuan.

On April 30, 2025, Zangge Mining completed a change of control, with Zijin International becoming the controlling shareholder and the actual controller changing to Shanghang County Finance Bureau. Zijin International and its concerted parties held a total of 26.18% of the company’s shares, and Zijin Mining held 25.99%.

According to a research report from Orient Securities, through its controlling shareholder Zijin International, Zangge Mining strategically entered the global top copper resource map, with core advantages relying on the “Julong Copper Mine,” a world-class project with clear expansion pathways.

In 2025, Julong Copper achieved revenue of 16.663 billion yuan and net profit of 9.141 billion yuan. Zangge Mining holds a 30.78% stake in Julong Copper, and during the reporting period, the company recognized 2.782 billion yuan in investment income from Julong Copper, accounting for about 70% of its net profit attributable to shareholders.

On January 5, 2026, Zangge Mining stated on an investment platform that the main construction and core equipment installation of the second phase of Julong Copper had been completed and successfully trial-run. After full production, the capacity will increase by 200,000 tons of ore processing per day. “At that time, the combined daily processing capacity of phases one and two will reach 350,000 tons, roughly equivalent to creating 1.3 ‘Julong’ mines. This will be China’s largest and the world’s highest-altitude, lowest-grade super-large copper mine, initially forming scale. Next, the second phase of Julong Copper will enter the final stage of full debugging and official commissioning.”

In the secondary market, Zangge Mining’s stock performed strongly in 2025. Over the year, the stock price rose from a low of 27.10 yuan per share to a high of 87.68 yuan per share, a maximum increase of 223.54%. As of the close on March 13, the company’s market capitalization was approximately 125.2 billion yuan.