Investment Rating - The report assigns a "Buy" rating for China Hongqiao (01378) as part of its initial coverage [4][6]. Core Views - The significant growth in the company's performance in the first half of 2024 is attributed to the simultaneous increase in both the volume and price of aluminum and alumina, alongside a decrease in procurement prices for coal and anodes, leading to reduced costs [5][6]. - The company plans to increase its dividend payout ratio to 56%, with an interim dividend of HKD 0.59 per share, resulting in a dividend yield of 5.7% based on the closing price on August 16, 2024 [6][8]. Summary by Sections Financial Performance - In the first half of 2024, China Hongqiao achieved revenue of CNY 73.59 billion, a year-on-year increase of 12.0%, and a net profit attributable to shareholders of CNY 9.15 billion, up 272.7% year-on-year [4][5]. - The production of aluminum alloy products reached 3.221 million tons, a 5.3% increase year-on-year, while sales were 2.837 million tons, up 0.5% year-on-year [5]. - The unit selling price for aluminum alloy products was CNY 17,379 per ton, a 6.7% increase year-on-year, while the unit cost was CNY 13,100 per ton, down 11.9% year-on-year, resulting in a unit gross profit of CNY 4,279 per ton, up 203% year-on-year [5]. Alumina Performance - The company sold 5.507 million tons of alumina in the first half of 2024, a 2.4% increase year-on-year, with a unit selling price of CNY 2,942 per ton, up 16.9% year-on-year [5]. - The unit cost for alumina was CNY 2,195 per ton, down 4.3% year-on-year, leading to a unit gross profit of CNY 748 per ton, an increase of 233% year-on-year [5]. Future Earnings Forecast - The report forecasts revenues for 2024, 2025, and 2026 to be CNY 147.4 billion, CNY 151.7 billion, and CNY 157.2 billion, respectively, with year-on-year growth rates of 10%, 3%, and 4% [6][7]. - Net profits attributable to shareholders are projected to be CNY 20.12 billion, CNY 21.35 billion, and CNY 23.39 billion for the same years, reflecting growth rates of 76%, 6%, and 10% [6][7]. - The earnings per share (EPS) are expected to be CNY 2.12, CNY 2.25, and CNY 2.47 for 2024, 2025, and 2026, respectively [6][7].
中国宏桥（01378）2024年中期业绩点评：铝及氧化铝量价齐升提升业绩，中期分红比例高