Core Viewpoint - The report from Zhongtai Securities maintains a "buy" rating for China Hongqiao (01378), citing improved macro sentiment and revised aluminum price assumptions for 2025-2027, with projected net profits of 240 billion, 242 billion, and 269 billion yuan respectively [1] Group 1: Financial Performance - In the first half of 2025, China Hongqiao achieved operating revenue of 81.039 billion yuan, a year-on-year increase of 10%, and a net profit attributable to shareholders of 12.4 billion yuan, up 35% year-on-year [1] - The company reported sales volumes for electrolytic aluminum, alumina, and aluminum processing products at 2.906 million, 6.368 million, and 392 thousand tons respectively, with year-on-year growth of 2.4%, 15.6%, and 3.5% [1] Group 2: Profitability and Cost Management - The gross profit margins for electrolytic aluminum, alumina, and aluminum processing products were 25.2%, 28.8%, and 23.3%, reflecting increases of 0.6 percentage points, 3.4 percentage points, and 2.3 percentage points year-on-year, primarily driven by rising prices [1] - The company's share of profits from joint ventures reached 1.8 billion yuan, significantly up from 800 million yuan in the same period last year, surpassing the total of 1.76 billion yuan for the entire previous year [2] Group 3: Share Buyback and Market Confidence - As of the first half of 2025, the company had repurchased and canceled 187 million shares for a total amount of 2.4 billion yuan, with a new buyback plan announced totaling no less than 3 billion Hong Kong dollars [3] - The ongoing buyback activity, which has reached a historical high in 2025, reflects the company's confidence in its future development [3] Group 4: Supply and Demand Dynamics - The supply of electrolytic aluminum is nearing capacity in China, while overseas production faces high construction costs and long timelines, leading to a supply growth rate of around 1% [4] - Demand for electrolytic aluminum is expected to grow by 2-3% due to factors such as renewable energy, grid construction, and packaging consumption, indicating a persistent supply-demand gap [4]

Core Viewpoint - Zhongtai Securities maintains a "buy" rating for China Hongqiao (01378), citing improved macro sentiment and adjusting aluminum price assumptions for 2025/2026/2027 to 20,500/20,500/21,500 RMB/ton [1] Group 1: Financial Performance - In the first half of 2025, China Hongqiao achieved operating revenue of 81.039 billion RMB, a year-on-year increase of 10%, and a net profit attributable to shareholders of 12.4 billion RMB, up 35% year-on-year [1] - The company expects net profits for 2025, 2026, and 2027 to be 24 billion, 24.2 billion, and 26.9 billion RMB respectively [1] Group 2: Production and Profitability - In H1 2025, the company sold 2.906 million tons of electrolytic aluminum, 6.368 million tons of alumina, and 392,000 tons of aluminum processing products, with year-on-year growth of 2.4%, 15.6%, and 3.5% respectively [1] - The gross margins for electrolytic aluminum, alumina, and aluminum processing products were 25.2%, 28.8%, and 23.3%, reflecting increases of 0.6 percentage points, 3.4 percentage points, and 2.3 percentage points year-on-year, primarily due to rising prices [1] Group 3: Joint Ventures and Cost Management - The company's share of profits from joint ventures reached 1.8 billion RMB in H1, significantly up from 800 million RMB in the same period last year, surpassing the total of 1.76 billion RMB for the entire previous year [2] - Overall expenses showed a downward trend, particularly due to the optimization of the debt structure, leading to a notable reduction in financial costs [2] Group 4: Share Buyback and Market Confidence - As of H1 2025, the company has repurchased and canceled 187 million shares for a total of 2.4 billion RMB, with a new buyback plan announced totaling no less than 3 billion HKD [3] - The buyback amount for the year has reached a historical high, indicating the company's confidence in its future development [3] Group 5: Supply and Demand Dynamics - The supply of electrolytic aluminum is nearing capacity in China, while overseas production faces high construction costs and long timelines, leading to a supply growth rate of around 1% [4] - Demand is expected to increase by 2-3% due to factors such as new energy, grid construction, and packaging consumption, resulting in a persistent supply-demand gap [4]