Net profit +77% YoY in 1H26, in line with profit alert

PLEASE READ THE ANALYST CERTIFICATION AND IMPORTANT DISCLOSURES ON LAST PAGE MORE REPORTS FROM BLOOMBERG: RESP CMBR <GO> OR http://www.cmbi.com.hk 1 MN 24 Aug 2026 CMB International Global Markets | Equity Research | Company Update Hongqiao Holdings (002379 CH) Hongqiao Holdings (002379 CH) - Net profit +77% YoY in 1H26, in line with profit alert Net profit +77% YoY in 1H26, in line with profit alert Hongqiao Holdings’ net profit came in at RMB15.6bn (up 77% YoY) in 1H26, in line with the profit alert announced in Jul. The results imply 1.2x YoY growth of net profit in 2Q26. The earnings growth in 1H26 was much higher than that of China Hongqiao (1378 HK, BUY), as (1) Hongqiao Holdings’ expense growth was less than that of China Hongqiao, and (2) Hongqiao Holdings does not own bauxite asset (weak bauxite price in 1H26). We revise up our 2026E/27E/28E earnings forecasts by 7%/4%/4%, mainly due to lower minority interest assumptions, which offset the lower forecast on alumina profit. Our TP is slightly lowered to RMB28, based on 12x 2026E P/E, equivalent to unchanged 20% premium to our target multiple (10x) for China Hongqiao (previously RMB29, as we trimmed our target P/E of China Hongqiao). Key highlights of 1H26 earnings Source: Company data, CMBIGM Target Price RMB28.00 (Previous TP RMB29.00) Up/Downside 53.6% Current Price RMB18.23 China Materials Wayne FUNG, CFA (852) 3900 0826 waynefung@cmbi.com.hk Jake Zhang (852) 3900 0849 jakezhang@cmbi.com.hk Stock Data Mkt Cap (RMB mn) 237,557.3 Avg 3 mths t/o (RMB mn) 1,021.0 52w High/Low (RMB) 32.53/14.15 Total Issued Shares (mn) 13031.1 Source: FactSet Shareholding Structure China Hongqiao 89.0% Source: HKEx Share Performance Absolute Relative 1-mth 1.1% 3.7% 3-mth -11.8% -8.6% 6-mth -39.5% -38.9% Source: FactSet 12-mth Price Performance Source: FactSet Related reports: Aluminium – Upside to our supply forecast following the resumption of EGA production – 13 Aug 2026 (link) Aluminium – Concerns largely priced in; Attractive valuation – 23 Jun 2026 (link) A prolonged supply deficit even assuming the end of Iran war – 12 May 2026 (link) Hongqiao Holdings (002379 CH) - High earnings sensitivity to aluminium price, high dividend payout; initiate with BUY – 12 May 2026 (link) Earnings Summary (YE 31 Dec) FY24A FY25A FY26E FY27E FY28E Revenue (RMB mn) 150,336 156,721 173,106 172,446 175,574 YoY growth (%) na 4.2 10.5 (0.4) 1.8 Adjusted net profit (RMB mn) 17,227.9 17,863.5 30,285.2 27,393.7 25,465.7 EPS (Adjusted) (RMB) na 1.37 2.32 2.10 1.95 Consensus EPS (RMB) na na 2.55 2.79 2.92 P/E (x) na 13.3 7.8 8.7 9.3 P/B (x) na 5.2 3.3 3.1 2.9 Yield (%) na 1.4 9.6 8.6 8.0 Net gearing (%) 27.4 10.7 (24.8) (26.6) (26.3) Source: Company data, Bloomberg, CMBIGM estimates (RMB mn)1H251H26Change (YoY)Total revenue77,27086,50412.0%Cost of sales-62,693-64,5513.0%Gross profit14,57621,95350.6%Other income and gains-27392n/aS&D expenses-26-19-25.9%Administrative expenses-1