Core Viewpoint - Bank of America Securities reaffirms "Buy" rating for China Hongqiao (01378) with a target price of HKD 26 [1] Company Summary - China Hongqiao's net profit for the first half of 2025 is projected to be RMB 12.36 billion, representing a 35% year-on-year increase, in line with expectations [1] - The profit composition for the first half of 2025 is estimated to be 63% from aluminum alloys, 29% from alumina, and 9% from aluminum products [1] - The company plans to maintain a dividend payout ratio of 65% for the fiscal year 2025, resulting in a dividend yield of 8% [1] - China Hongqiao intends to repurchase at least HKD 3 billion of its shares [1] Industry Summary - Bank of America Securities forecasts aluminum prices in China to be RMB 20,500 per ton for the fiscal years 2025-2026, with a long-term price of RMB 20,000 per ton [1] - Due to a cost advantage of approximately 5% compared to global peers, Chinese aluminum companies are expected to achieve profits of RMB 3,000 to RMB 4,000 per ton, significantly above historical averages of RMB 1,000 to RMB 2,000 per ton [1] - Given the low cyclicality, strong cash flow, and attractive dividend yield, Chinese aluminum companies are projected to attain a price-to-earnings ratio of at least 10 times, comparable to the global average [1] - The West Mound project is expected to commence production by the end of 2025, contributing positively to the company's outlook [1]
美银证券：重申中国宏桥(01378) “买入”评级 目标价为26港元