West Securities: Maintains "Buy" rating on CHINAHONGQIAO, with 2025H1 performance significantly exceeding market expectations

According to the Zhitong Finance APP, Western Securities released a research report stating that CHINAHONGQIAO (01378) announced its 2025 semi-annual report, achieving revenue of 81.039 billion yuan, a year-on-year increase of 10.12%; net profit attributable to shareholders was 12.361 billion yuan, a year-on-year increase of 35.02%, significantly exceeding market expectations; and plans to repurchase shares worth no less than 3 billion Hong Kong dollars. The firm expects the company's EPS for 2025-2027 to be 2.32, 2.51, and 2.64 yuan respectively, with PE ratios of 9, 9, and 8 times, maintaining a "buy" rating.

Western Securities' main points are as follows:

2025H1 performance significantly exceeded market expectations, with improvements in operating net cash flow and period expenses

1. Aluminum alloy products: Sales volume was 2.906 million tons, a year-on-year increase of 2.4%; sales price was 17,853 yuan/ton (excluding tax), a year-on-year increase of 2.7%; revenue reached 51.878 billion yuan, a year-on-year increase of 5.2%; gross margin was 25.2%, a year-on-year increase of 0.6 percentage points.

2. Alumina products: Sales volume was 6.368 million tons, a year-on-year increase of 15.6%; sales price was 3,243 yuan/ton (excluding tax), a year-on-year increase of 10.3%; revenue reached 20.655 billion yuan, a year-on-year increase of 27.5%; gross margin was 28.8%, a year-on-year increase of 3.4 percentage points.

3. Aluminum alloy processing products: Sales volume was 392,000 tons, a year-on-year increase of 3.5%; sales price was 20,615 yuan/ton (excluding tax), a year-on-year increase of 2.9%; revenue reached 8.074 billion yuan, a year-on-year increase of 6.5%; gross margin was 23.3%, a year-on-year increase of 2.3 percentage points.

4. Operating net cash flow was 22.306 billion yuan, a year-on-year increase of 56.38%.

5. In terms of expenses, selling expenses were 354 million yuan, a year-on-year decrease of 3.4%; administrative expenses were 2.322 billion yuan, a year-on-year decrease of 5.4%; financial expenses were 1.284 billion yuan, a year-on-year decrease of 17.7%. Overall, the company's performance in the first half of the year significantly exceeded market expectations, and the quality of earnings continued to improve.

In 2025H1, 2.61 billion Hong Kong dollars have been repurchased and canceled, with a new round of repurchase of no less than 3 billion Hong Kong dollars, committing to maintain the same dividend payout ratio in 2025 as in 2024, fully emphasizing shareholder returns

1. According to the company's announcement, as of the end of the first half of 2025, the company had repurchased approximately 2.61 billion Hong Kong dollars worth of shares, all of which were canceled (approximately 187 million shares); 2) The company announced a new round of repurchase plan, intending to repurchase no less than 3 billion Hong Kong dollars; 3) The company also committed to maintaining the same level of dividend payout ratio in 2025 as in 2024 (the company's dividend payout ratios from 2021 to 2024 were 48%, 49%, 47%, and 63% respectively), fully emphasizing shareholder returns.

Risk Warning: Global economic recovery situation, policy risks, project progress, fluctuations in raw material prices, etc