Daqin Railway - A May volume +18% Y/Y on decline in coal imports; earnings bottom; stay OW

Research evidence excerpt

Daqin Railway - A May volume +18% Y/Y on decline in coal imports; earnings bottom; stay OW

J P M O R G A N Asia Pacific Equity Research

15 June 2026

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Daqin Railway - A Overweight

601006.SS, 601006 CH

May volume +18% Y/Y on decline in coal imports; Price (15 Jun 26):Rmb5.07

earnings bottom; stay OW ▼Price Target (Dec-27):Rmb6.30 Prior (Dec-26):Rmb6.50

Daqin’s May freight volume rose 18% Y/Y, helped by declining coal imports, as

imported coal competes with Daqin-shipped domestic thermal coal for Infrastructure, Industrials &

Transportsoutheastern coastal coal IPP demand. China coal industry imports fell 13% Y/Y

and -2% Y/Y YTD, while Daqin’s Jan-May volume rose 7% Y/Y, supporting our Jenny Qiu, CFA AC

view that import substitution is driving a cleaner recovery. We think FY2025 (852) 2800 8503

jenny.qiu@jpmorgan.com

marked the earnings trough, with revenue and margins set to improve as Daqin

gradually reduces freight discounts and avoids another aggressive logistics Karen Li, CFA

(852) 2800-8589

expansion in 2026. We forecast NPAT of Rmb7.4B/Rmb8.0B/Rmb8.6B in FY26E/ karen.yy.li@jpmorgan.com

FY27E/FY28E, up 25%/9%/7% Y/Y, and retain OW with a trimmed Rmb6.3 PT.

Sunny Su

The stock trades at 0.6x FY27E P/B with a 4.3% FY27E dividend yield, while (852) 2800 8551

dividend clarity around the interim report in August and sustained volume sunny.su@jpmorgan.com

recovery are key re-rating catalysts. Mufan Shi

(852) 2800-8502

• Import substitution is driving the traffic recovery.