 Kumba Iron Ore is the largest South African iron ore exporter, 69.7% owned by Anglo American. The Company has two production mines in South Africa, producing c 37-40mt per year. Kumba targets a 5-6% increase in production volumes in 2024-25 and sales of around 37-39mt per year in the medium term. The recovery of Chinese demand shall drive the iron ore market in 2023-24, helping Kumba to perform in line with expectations. We assume a limited downside in iron ore prices due to Chinese demand recovery and high inflation in producing countries. The company may have a relatively flat production profile for Kumba’s 12- and 17-year mines, benefiting from stable cash flow with modest maintenance capex.  Kumba Iron Ore has a high-quality resource base and an attractive cost profile. The life of the mine plan for saleable products includes production until 2039. Kumba’s Sishen and Kolomela mines produce high-grade (63-65% Fe content) and high-quality lump ore and fine ore, benefiting from premium prices and stable demand. The demand will likely grow for premium iron ore as the ecological standards of steel producers become tighter. The company can generate a strong cash flow and deliver a stable dividend flow for shareholders. We initiate coverage of Kumba Iron Ore with a 12-month target price of ZAR571, rating Buy.