The 'Coal Madness' resulted in a 20 billion yuan loss in one year

Iravan774

The 'Coal Madness' resulted in a 20 billion yuan loss in one year, causing shareholders to be restless.

Last year, due to tightened environmental policies, restricted coal production, and a significant contraction in coal imports, various supply constraints led to a surge in the prices of the three main coal futures: coking coal, coke, and thermal coal. Coal prices entered an upward channel, reaching a ten-year high in the market. The price of thermal coal, in particular, briefly surged to the highest level of 1982 yuan per ton in October of last year, with spot prices rising to 3000 yuan per ton, resulting in a daily increase of 7.21%.

With coal stocks and futures experiencing a substantial rise, the net profits of coal enterprises also soared. One of the major coal companies in China, Shenhua Group (601088.SH), achieved a net profit of 40.751 billion yuan in the first three quarters, a year-on-year increase of 21.4%, reaching a new high for the same period in nearly eight years. However, where there is joy, there is also concern. While some companies saw a surge in profits, others faced losses. Shenyang Jinshan Energy Co., Ltd., representing the power sector, experienced a net loss of 18 billion to 20.38 billion yuan for the year 2021, a year-on-year reduction of 18.82 billion to 21.20 billion yuan. The reason cited was the inverted cost structure in power generation and heating.

In fact, Jinshan Energy is just a representative of such companies. Other coal-related industries, such as Datang Power (601991.SH), China Power International (600027.SH), and Datang Power (601991.SH), also saw a significant decline in net profits due to increased operating costs. However, Jinshan Energy suffered more severe annual losses, causing unrest among its 70,000 shareholders. It's not surprising considering that a company with a market value of only 5 billion yuan incurred a loss of 20 billion yuan in a year. How could they stay calm? When Maomao saw someone saying they just bought this stock today, one couldn't help but feel a shiver, as they caught the falling knife.

977Iti

In the capital market, what comes quickly can also go quickly.

Niti998

It's normal for any industry to have ups and downs, following a common pattern.

Kamal531

There might be other reasons for this loss as well.

Kahn332

It seems that coal stocks are not very optimistic at the moment.