The Zhitong Finance App learned that Jefferies released a research report saying that China Aluminum (02600)'s net profit for the second quarter was about 6.3 billion yuan, better than expected. Net profit for the first half of the year rose 68% year on year to 11.9 billion yuan, which is in the upper middle of the profit forecast range. The interim dividend payout ratio increased to 40% from 30% in the same period last year. The bank maintained a “buy” rating. The target price for H shares was reduced from HK$14.7 to HK$11.5, and the target price for A shares (601600.SH) was reduced from RMB 15.2 to RMB 12.4.
According to the report, the company's operating cash flow reached RMB 26.3 billion in the first half of the year. Strong cash flow supported increased dividend payments and reduced debt pressure. Net debt dropped sharply from RMB 18.4 billion at the end of the first quarter to RMB 7.4 billion. The management's 2026 capital expenditure guideline is approximately RMB 15 billion (excluding mergers and acquisitions), mainly for technology upgrades, intelligent production and green energy, etc., emphasizing that it can be fully covered by operating cash flow without external financing.
In terms of bauxite self-sufficiency, it reached 75% in the first half of the year, up from 65% in the full year of 2025. Management guides bauxite production of 4,000 to 45 million tons in 2026. Compared with the calculation of alumina production, the self-sufficiency rate is expected to exceed 80%. In terms of supply prospects, management believes that although some projects are speeding up the expansion of overseas smelters, it will be difficult to achieve major breakthroughs in the next three years, mainly due to reliable electricity supply issues, and Order No. 837 introduced in June to raise foreign direct investment requirements, or affect Chinese companies' overseas production expansion plans.