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[Opportunity Express] Surging Over 200%! Is JL Mag Riding the Wave to New Heights?

In the wave of global green transformation and technological upgrading,$JLMAG (06680.HK)$Leveraging its technological advantages and capacity expansion, it is becoming a core beneficiary in multiple high-growth areas.

Since the beginning of the year, its stock price has risen by over 200%, making it one of the most prominent stocks in the Hong Kong stock market. What competitive advantages does Jinli Permanent Magnet have? How much growth potential is there in the future, and should investors take profits and exit or continue to hold their shares in anticipation of further increases?

The rapidly growing golden track

The industry has broad prospects.

$JLMAG (06680.HK)$As a global leader in high-performance neodymium-iron-boron (NdFeB) permanent magnet materials,With 16 years of deep involvement in permanent magnet materials, the company primarily focuses on the research, production, and sales of high-performance rare earth permanent magnet materials. Simply put, it produces the strongest permanent magnets available today, which serve as a core power source for many high-end manufacturing and clean energy sectors.

Currently, the entire rare earth permanent magnet market is experiencing rapid growth. According to a Frost & Sullivan report,Global consumption of high-performance rare earth permanent magnet materials is growing at a compound annual growth rate (CAGR) of approximately 17%.It is projected that by 2028, the market size will more than double compared to 2023. This indicates that the industry has significant growth potential and is far from reaching its peak.

Furthermore,The rare earth permanent magnet industry is part of China's strategic emerging industries and receives strong support from government industrial policies.Whether it’s promoting new energy vehicles in rural areas, replacing old home appliances with new ones, or fostering low-altitude economies, artificial intelligence, and robotics, its products are indispensable. They play a key role in forming 'new productive forces.'

Possesses a solid competitive moat.

Generally speaking, the rare earth permanent magnet industry itself has natural barriers such as high technology, heavy reliance on resources, and strong customer relationships, enabling leading companies to build a solid competitive advantage.。

The upstream of the industry comprises rare earth materials, while the downstream consists of end-user applications. As a midstream producer, Jinli has mastered the most advanced 'grain boundary diffusion technology.'This core technology significantly reduces the use of expensive and strategically important 'heavy rare earths,' ensuring high magnetic performance while substantially lowering costs. Jinli Permanent Magnet’s application rate of this technology has exceeded 90%, forming a robust technological moat.

Image source: Jinli Permanent Magnet earnings report

The company's upstream operations involve rare earth mining and rare earth smelting.Rare earths are a strategic national resource, particularly for heavy rare earths, which face geopolitical supply risks. By establishing long-term strategic partnerships with key domestic suppliers like China Rareearth and Northern Rare Earth Group, and by building factories in rare earth production areas such as Jiangxi and Inner Mongolia, Jinli Permanent Magnet has effectively ensured the stability and security of its raw material supply chain.

The company's downstream applications span a wide range of fields, including new energy vehicles, wind power generation, energy-saving elevators, industrial robots and humanoid robots, and variable frequency air conditioners., with expected 4-year CAGRs for demand of high-performance neodymium-iron-boron magnetic materials in these areas being 29.89%, 19.26%, 15.86%, 8.61%, and 7.67%, respectively (data source: China Merchants Securities research report).

In the field of new energy vehicles,JL MAG's products are used by the world's top ten new energy vehicle manufacturers to produce drive motors, including core clients such as Tesla, BYD, SAIC Motor, and Volkswagen.In the field of energy-saving variable frequency air conditioners,eight out of the top ten global producers of variable frequency air conditioning compressors are the company’s clients, such as Midea and Gree.In the wind power sector,five of the world's top ten wind turbine manufacturers are company clients.

Furthermore,JL MAG is focusing on the development of motor rotor research for embodied robots. As the exclusive supplier of magnetic components for Tesla Optimus, orders are expected to grow by 300% by 2025.The company has already made small-batch deliveries, laying the groundwork for subsequent large-scale production.

Performance Data Analysis

Strong fundamentals with core business maintaining growth

A detailed analysis of its performance shows that the company's revenue began to recover in Q3 2023. Given that over 90% of its income is derived from the sale of neodymium-iron-boron (NdFeB) magnetic materials, the company's revenue is highly correlated with fluctuations in the prices of neodymium and praseodymium metals. The continuous rise in rare earth magnet prices over the past two years has gradually stabilized revenue.

In Q2 2025, the company achieved revenue of 1.753 billion yuan, a slight year-on-year decrease of 4%.The main reasons were the decline in non-core businesses such as sales of magnetic sludge waste materials, along with a drop in overall overseas sales revenue due to export restrictions.

Data source: Wind

However, looking at the overall revenue for H1 2025, the company generated 3.507 billion yuan in revenue, representing a year-on-year increase of 4.38%, showing a stable growth trend.。

Secondly, among the overall revenue, based on contribution ranking, new energy vehicles and components accounted for the highest share, contributing 1.675 billion yuan in H1, a year-on-year increase of 28.14%. Next was inverter air conditioners, generating revenue of 1.05 billion yuan, a year-on-year increase of 19.85%. Additionally, wind power contributed 214 million yuan, robotics-related revenue was 133 million yuan, and the 3C sector contributed 101 million yuan.

Overall, new energy vehicles form the core revenue base, accounting for nearly half of total revenue.According to Bloomberg New Energy Finance forecasts, global new energy vehicle sales are expected to exceed 20 million units in 2025, sustaining robust demand for NdFeB permanent magnets and continuing to support Jinli’s revenue sources.

Additionally, humanoid robots are expected to become a new growth point for the company.Currently, $Tesla (TSLA.US)$ and leading domestic companies are actively developing robots. Currently, each robot consumes approximately 3.5 kilograms of high-performance neodymium iron boron. If humanoid robots enter mass production, it will bring $JLMAG (06680.HK)$ more significant growth.

Continuous improvement in profitability

The company’s gross margin and net profit margin rebounded from their lowest point in Q2 2024, showing steady recovery. In Q2 2025, the company achieved a net profit of 144 million yuan, with a gross margin of 17% and a net profit margin of 8%.

Data source: Wind

The recovery in rare earth prices has been an important factor driving the improvement in the company's profitability. For example, taking praseodymium-neodymium metal as a reference, according to data from the China Rare Earth Industry Association, the average price in July 2025 was 580,000 yuan per ton, representing an increase of approximately 16% compared to the average price of 500,000 yuan per ton in January 2025. The stable and gradual rise in rare earth prices has driven marginal improvements in the gross margin.

According to the latest data in August, the price of neodymium-praseodymium metal was 697,100 yuan per ton, marking a 19.8% month-on-month increase. Given the continuously growing downstream demand and the supply-demand gap on a global scale, there remains room for further increases in rare earth raw material prices. If the company successfully transfers rising costs to downstream customers through a cost-plus pricing model, its profitability will continue to be supported.

Investment Strategy

Based on the above fundamental information, we can gain a general understanding of the growth prospects and investment opportunities for JL MAG Rare-Earth Co., Ltd. within the rare earth industry chain. Benefiting from developments in sectors such as new energy and robotics, the company still has significant growth potential in the future.

So, how should investors approach trading going forward? Investors are advised to focus closely on technical trading signals.

Technical Opportunities

First, lookWeekly Chart， $JLMAG (06680.HK)$ Since bottoming out at the end of 2024, the stock price has surged to a high of 25.22. Although the weekly chart continues to reflect a strong upward trend, a short-term resistance level has formed near 25.22, with several recent weeks failing to break through successfully. If the price can effectively surpass and stabilize above this level, it may open up greater upside potential for the future.

ReferenceDaily ChartIn conjunction with EMA trend analysis, when the stock is in a robust uptrend, holding onto shares is the best course of action.

For investors who are not currently holding positions,it can be observed that each time the stock price retraces to near the 50-day Exponential Moving Average (EMA), it typically forms a strong support level, presenting opportunities for short-term entry or adding to existing positions.Taking the stock price on September 24 as an example, the price retreated to 20.7 yuan, which could be considered a relatively safe entry point. However, if the stock price continues to decline, breaking below the 50-day EMA and the 12-day EMA crosses below the 50-day EMA, this would signal the beginning of a retracement trend, with a higher probability of further declines. Investors should promptly take profits or cut losses.

Furthermore, when considering the Relative Strength Index (RSI) technical indicator, the RSI is currently at the 50 level, temporarily not reaching the overbought condition of >70. Therefore, it still merits continued holding or attention at this stage. Of course, no technical indicator is infallible, and other tools of technical analysis should be used in conjunction to achieve better results.

The above concludes this installment of the quick individual stock teaching segment. If you have differing views, feel free to leave comments and engage in discussions in the comment section.

Risk Disclosure: This content does not constitute a research report and is for reference only. It should not be used as the basis for any investment decision. The information provided does not fully describe the securities, markets, or developments mentioned. Although the sources of information are considered reliable, the accuracy or completeness of the above content is not guaranteed. Additionally, no guarantee is made regarding the accuracy of any statements, views, or forecasts provided in this article.

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