HK Stock Market Move | CHINAHONGQIAO (01378) up over 3% hits new high in the first half of the year, net profit is expected to increase by over 35%. Institutions say supply constraints support upward trend in aluminum prices.

CHINAHONGQIAO (01378) rose by more than 3% in midday trading, reaching a high of 22.62 Hong Kong dollars, hitting a new high. As of the time of writing, it has risen by 2.2% to 22.32 Hong Kong dollars, with a trading volume of 3.39 billion Hong Kong dollars. On the news front, CHINAHONGQIAO previously released positive earnings, with the company expecting to achieve a net profit attributable to shareholders of approximately 12.359 billion yuan in the first half of the year, an increase of around 35% year-on-year. The significant growth in performance is mainly due to the year-on-year increase in aluminum prices, coupled with a decrease in the cost of thermal coal on the cost side. It is reported that electrolytic aluminum is the company's main source of revenue and profit, with self-produced and self-used alumina being the main component, with some being sold externally. Guolian Minsheng Securities released a research report stating that domestic electrolytic aluminum production capacity is approaching its limit, and future new capacity may be limited; demand is supported by factors such as the power grid and new energy vehicles, and the gap between supply and demand for electrolytic aluminum is expected to gradually become evident, driving the central price of aluminum upwards. The bank pointed out that on July 29, the China Nonferrous Metals Industry Association stated that they will "strictly control the new production capacity of alumina". In the medium to long term, as the "anti-internal consumption" policy continues to intensify, the pace of commissioning new alumina production capacity may slow down, thereby improving the overcapacity situation.