Guosheng: Maintains "Buy" Rating on CHINAHONGQIAO (01378) as Half-Year 2026 Performance Hits Record High

Guosheng released a research report stating that it maintains a "Buy" rating for CHINAHONGQIAO (01378). The firm expects that from 2026 to 2028, the company's net profit attributable to shareholders will reach 35.3 billion, 33.9 billion, and 32.2 billion yuan, corresponding to price-to-earnings ratios of 6.4, 6.7, and 7.1 times, respectively. In the first half of 2026, the company achieved revenue of 87.51 billion yuan, a year-on-year increase of 8%; net profit was 17.21 billion yuan, a year-on-year increase of 39%; earnings per share were 1.734 yuan, a year-on-year increase of 32%. The revenue growth was mainly due to the year-on-year increase in sales prices of aluminum alloy products, the year-on-year increase in sales volume of deep-processed aluminum alloy products, and the increase in sales prices on a year-on-year basis. The firm believes that at the current point in time, cost reduction and efficiency enhancement are key to competition, and the company is expected to achieve leapfrog growth through deep empowerment across the supply chain. Guosheng's main viewpoints are as follows: The price of electrolytic aluminum has risen significantly year-on-year, significantly enhancing the company's profitability. 1) Volume: In the first half of 2026, the company's aluminum alloy product sales reached approximately 2.811 million tons, with alumina product sales of about 6.917 million tons, up 8.6% year-on-year; deep-processed aluminum alloy product sales reached approximately 444,000 tons, up 23.2% year-on-year. 2) Price (excluding tax): In the first half of 2026, the average sales price of aluminum alloy products increased by approximately 18.7% year-on-year to 21,192 yuan/ton; the average sales price of deep-processed aluminum alloy products increased by approximately 13.4% year-on-year to 23,436 yuan/ton. 3) Profit: In the first half of 2026, the gross profit of alumina was 146 yuan/ton; the gross profit of aluminum alloy products was 8,161 yuan/ton, up 81% year-on-year; the gross profit of deep-processed aluminum alloy products was 7,658 yuan/ton, up 74% year-on-year. Practicing the "dual carbon" goal, leading green development. The company consistently adheres to the path of green development, placing carbon reduction and emission reduction at the core of its production management system. Against the backdrop of the national push for low-carbon development, the company has steadily initiated the transfer of electrolytic aluminum capacity to Yunnan; as of June 30, 2026, it has commissioned approximately 2.2802 million tons of electrolytic aluminum capacity in Yunnan. Through capacity transfer, the company can leverage Yunnan's rich hydroelectric and new energy resource advantages to increase the share of renewable energy use, achieve green and low-carbon development, and effectively meet the demand of China's southern aluminum consumption market. Persisting in technological innovation and cultivating new quality productive forces. The company places great importance on the research, development, and application of electrolytic aluminum production technology, currently holding multiple patents covering various fields including process optimization, energy consumption reduction, and environmental protection. In 2014, it built the world's first industrial-scale 600kA ultra-large electrolytic aluminum production line, and in 2023 successfully developed the next-generation aluminum electrolysis iterative technology "Integrated Copper-Carbon Composite Cathode Technology Development and Application," which leads the industry in technological level and green development capabilities. Risk Disclaimer Risks of significant fluctuations in metal prices, global political instability and exchange rate risks, market competition, and demand fluctuation risks, etc.