CCB International: Maintains "outperform the industry" rating for CHINAHONGQIAO(01378), expected to benefit from the increase in aluminum and alumina prices.

China Gold Research Report stated that it maintains a "outperform industry" rating for CHINAHONGQIAO (01378). The bank maintains the group's profit forecast for the next two years at 42.6 billion and 42.8 billion yuan respectively, and maintains a target price of 47.54 Hong Kong dollars, corresponding to a PE ratio of 10 times for the next two years, with a potential increase of 38%. For the performance in 2025, the company's operating income was 162.354 billion yuan, a year-on-year increase of 4%; gross profit was 41.505 billion yuan; and net profit attributable to shareholders of the company was 22.636 billion yuan, a year-on-year increase of 1.2%. In terms of development trend, China Gold stated that the company is the leading player in the aluminum industry with an integrated green industry chain, which is expected to benefit from the increasing aluminum and alumina prices due to the tense geopolitical situation. From the upstream perspective, according to the announcement, the company has developed bauxite supply bases in Guinea to ensure the supply of raw materials; after the relocation and transformation of domestic alumina production capacity, the total capacity has reached 21 million tons/year, an increase of 8% year-on-year. From the midstream perspective, the company's total electrolytic aluminum production capacity is 6.46 million tons/year, and it is implementing the "moving the aluminum industry south" plan to relocate some production capacity from Shandong to Yunnan; at the same time, it has acquired 25% minority shareholder rights of Yunnan Hongtai, leading to a 6% increase in the company's electrolytic aluminum equity production capacity. From the downstream perspective, the company continues to expand its automotive lightweighting business and build a green recycling industry matrix.