The analyst rating from UBS is based on their assessment of the thermal coal market in China, particularly the expected price range of RMB750-800 per ton for 2026. They note that there is potential for price increases during the May-June summer restocking period, influenced by high international energy prices and fluctuations in Indonesian supply. However, they also highlight that in a tight supply scenario, prices may briefly reach RMB900 per ton, but sustained surges are unlikely due to China's effective policy response capabilities.
UBS has set a target price of RMB48.6/$48 for CHINA SHENHUA (01088.HK) and rated it as Neutral, indicating that they believe the stock is fairly valued at its current price. Conversely, they have maintained a Sell rating for YANKUANG ENERGY (01171.HK) and SHAANXI COAL IND (601225.SH), with target prices of $11.4/RMB22.8, suggesting that they believe these stocks are overvalued as current prices have already incorporated the underlying fundamentals.
