Core Viewpoint - Aluminum prices reached a three-year high in the first half of the month, primarily driven by macroeconomic sentiment and market reactions to the Federal Reserve's interest rate decision [1] Group 1: Market Dynamics - The market's assessment of the Federal Reserve's decision slightly exceeded expectations, leading to a moderate increase in the aluminum market [1] - The Central Political Bureau meeting in China released positive signals, providing robust support for commodities [1] - Strong performance in silver and copper has positively influenced aluminum prices [1] Group 2: Supply and Demand - Supply constraints in the northwest have limited shipments, resulting in a decrease in social inventory [1] - Demand shows differentiated performance across consumption areas, with overall trading exhibiting resilience [1] - The sentiment in the market has shifted, maintaining high spot aluminum prices despite seasonal pressures [1] Group 3: Price Forecast - As sentiment cools in the latter half of the month and seasonal factors exert pressure, aluminum prices are expected to adjust to a range of 21,000 to 21,500 yuan per ton [1]

Core Viewpoint - The company has successfully completed a share placement to meet domestic and international project needs and debt repayment, which is expected to optimize its asset structure and quality in the future [1] Group 1: Share Placement and Fund Allocation - The company announced the completion of a share placement and subscription agreement, issuing a total of 400 million shares at a subscription price of HKD 29.20 per share, with expected net proceeds of approximately HKD 11.49 billion [1] - Of the proceeds, 60% (approximately HKD 6.894 billion) will be used for the development and enhancement of domestic and international projects, with significant capital expenditures planned for the next three months [1] - 30% (approximately HKD 3.447 billion) will be allocated for repaying existing debts to optimize the company's capital structure, with total debts due before June 30, 2026, amounting to approximately HKD 54 billion [1] - The remaining 10% (approximately HKD 1.149 billion) will be used for working capital and general corporate purposes, including coal procurement and other raw materials [1] Group 2: Future Development and Shareholder Confidence - The controlling shareholder, Hongqiao Holdings, has increased its stake in the company, purchasing 7.5 million shares at an average price of approximately HKD 30.54 per share, raising its ownership from 63.94% to 64.02% [2] - Following the share placement, Hongqiao Holdings' stake decreased to 59.82%, but after the subscription, it increased to 61.44%, indicating strong confidence in the company's future development [2] Group 3: Financial Performance and Market Outlook - China Hongqiao's subsidiary, Shandong Hongqiao, reported a 6% year-on-year increase in revenue for the first three quarters, totaling RMB 116.93 billion, with a 23% increase in net profit to RMB 19.37 billion [3] - The third quarter saw revenue of RMB 38.7 billion, a 2% year-on-year increase, and a net profit of RMB 6.9 billion, an 18% year-on-year increase, driven by improved profitability in the electrolytic aluminum sector [3] - The average aluminum price in China has risen to RMB 21,407 per ton since Q4 2025, supported by tight global supply and increasing demand, which is expected to benefit the company [3][4] Group 4: New Project Contributions - The company’s West Simandou iron ore project has officially commenced production, with an expected output of 30 million tons in the first year and reaching full capacity in the second year, which is anticipated to enhance the company's performance [4]

Report Industry Investment Rating - Not provided Core Views - The price of finished products is expected to move in a sideways consolidation [2] - The price of aluminum is expected to move within a short - term range, and attention should be paid to macro sentiment and downstream开工 [3] Summary by Relevant Catalogs Finished Products - Yunguizhou region's short - process construction steel producers will stop production for maintenance from mid - January, and resume production around the 11th to 16th day of the first lunar month, affecting a total output of 741,000 tons during the shutdown. In Anhui, 6 short - process steel mills have or will stop production, affecting a daily output of about 16,200 tons [1] - From December 30, 2024, to January 5, 2025, the contracted area of newly built commercial housing in 10 key cities was 2.234 million square meters, a 40.3% month - on - month decrease and a 43.2% year - on - year increase [2] - The price of finished products continued to decline in a volatile manner, hitting a new low recently. In the context of weak supply and demand, market sentiment is pessimistic, and winter storage is sluggish, providing little support for prices [2] Aluminum Ingots - The new US tariff policy has raised the tariff on steel and aluminum from 25% to 50%, which will take effect at 00:01 on June 4, Eastern Time. The Midwest US duty - paid aluminum premium has soared to 58 cents per pound (about $1,280 per ton), a 54% increase from last Friday, reaching the highest level since 2013 [1][2] - In May 2025, China's bauxite production increased by 5.0% month - on - month and 19.1% year - on - year. Some mines are undergoing environmental inspections, which may affect production [2] - As of May 30, the average profit of the alumina industry exceeded 400 yuan per ton. In June, alumina production capacity is expected to gradually resume and new production capacity will be further released [2] - The PMI composite index of the aluminum processing industry in May was 49.8%, close to the boom - bust line but still in the contraction range. It decreased by 1.8 percentage points month - on - month and increased by 8.7% year - on - year, mainly due to the off - season and weak terminal demand [2] - As of June 3, the inventory of electrolytic aluminum ingots in major domestic consumption areas was 519,000 tons, a decrease of 15,000 tons from the previous week [2] - Uncertainty at the mine end may increase price fluctuations. The inventory faces accumulation pressure in the off - season, and the short - term aluminum price is expected to adjust in a range [3]