中国铝业（2600.HK）实地考察要点

Aluminum Corporation of China (2600.HK)KeyTakeawaysfromSiteVisit WevisitedBaotouAluminum,asubsidiaryofChalco,on23rd-24thJul andattended ameetingwith Chalco'smanagementteam.Ms.ZhuDan,CFO and Board Secretary,andothermanagementteammembersattendedthemeeting.Mgmt.believesChinawillkeepthecapacitycappolicy.Therecouldbe3%-5%overproductionthroughincreasingcurrentintensity,butitiseasyforauthoritiestocheckthepowerconsumption.Keytakeawayssummarizedbelow.MaintainBuy. Target priceHK$17.08Expectedshareprice return105.8%Expected dividend yield6.5%Expectedtotal return112.3%MarketCapHK$177,157MUS$22,589M Therecouldbe3%-5%overproductionthroughincreasingcurrentintensity,butitiseasyforauthoritiestosupervisebycheckingthepowerconsumption.Consideringthemaintenance workfor20+days,thealuminumoutput in several months couldsomeproducersmaycounttherecyclingaluminumoutputtothetotalprimaryaluminumproductionstatistics,resultinginhigheraluminumoutputthancapacity. JackShang,CFAAc+852-2501-2441jack.shang@citi.com AnnaWang+852-2501-2739anna.d.wang@citi.com Overseascapacityaddition-TheStateCouncilOrderNo.837,RegulationsonOutbound Investment,introducedstrictermeasuresforODIlapproval.Thefundsoutflowforinvestment inoverseasforbothSOEsandPOEsneedtogettheODlapproval, whiletheinvestment throughfunds in overseas alreadydonotneedtogetODIapproval.Thenewregulation also strengthensthereviewofactualcontrollingshareholder.Chalco'sstrategyofoverseas investmentisfocused onresourcesacquisitionandaluminum capacityintheregionswith renewableenergy. JimmyFengjimmy.feng@citi.com Cynthia Wucynthia.d.wu@citi.com Demand-Mgmt.expectsthedemandfromAl,powerandgrid,andaluminumsubstitutionforcoppersegmentscouldoffsettheweakdemandgrowthintraditionalindustries.ChalcoexpectsglobalaluminumconsumptionCAGRwillbe~4%inthenextfewyearsbenefitingfromincreasingdemandfromNEV,ESS,AIDC,etc. Strategy-Withvertical integratedbusinessmodel,Chalco'scostranksatthelowest30%ofglobalaluminumcostcurve.In15thFYP,Chalcowillfocusonaluminumcapacitythatisbelow3oOka,andlayoutofoverseasaluminumcapacityintheregionswithrenewableenergy. 27July2026 keybottleneckisrecyclingchannelsandclassificationofscraps. YoY.Chalcowillalsoconsidersharerepurchaseandmajorshareholderincreasingstakes. AluminumCorporationofChina Our target price of HK$17.08/sh for the Chalco H-share is based on 2.83x 2026E PB, set at 2.25x SD above the historical Downsiderisksthatcouldimpedethestockfromreachingourtargetpriceare:1) Lower-than-expectedaluminumandalumina prices; 2) Higher-than-expected costs; 3) Higher-than-expected impairmentloss; and 4)The Chinese government may loosenitssupplycutpoliciesifaluminumpriceovershoots. US+1-210-677-3788 Appendix A-1 Theresearchanalystsprimarilyresponsibleforthepreparationandcontentofthisresearchreportareeither(i)designated analystsaredesignatedintheauthorblock,eachanalystiscertifyingwithrespecttotheentireresearchreportotherthan(a)contentattributabletoanotherACcertifyinganalystlistedinboldalongsidethecontentand(b)viewsexpressedsolelywithrespecttoaspecificissuerwhichareattributabletoanotherACcertifyinganalystidentifiedinthepricechartsorratinghistorytablesforthat issuershownbelow.Eachoftheseanalystscertify,withrespecttothesectionsofthereportforwhichtheyareresponsible:(1)thattheviewsexpressedthereinaccuratelyreflecttheirpersonalviewsabouteachissuerandsecurityreferencedandwerepreparedinanindependentmanner,includingwithrespecttoCitigroupGlobalMarketsInc.and itsaffiliates;and (2)nopartoftheresearchanalyst'scompensationwas,is,orwillbe,directlyorindirectly,relatedtothespecificrecommendationsorviewsexpressedbythatresearchanalystinthisreport.IMPORTANTDISCLOSURES AluminumCorporationof China(2600.HK) Short-Term View/Catalyst Watch Research Analyst Jack Shang,CFA TheFirmhasmadeamarket inthepubliclytradedequitysecuritiesofAluminumCorporationofChina Ltdonatleastoneoccasionsince1Jan2025 27 July 2026 past12monthsfromAluminumCorporationofChina.CitigroupGlobal MarketsInc.orits affiliates expectstoreceiveorintendstoseek,withinthenextthreemonths,compensation forinvestmentbanking servicesfromAluminumCorporationof China. servicesfromAluminumCorporationofChinainthepast12months.CitigroupGlobal MarketsInc.oritsaffiliatescurrentlyhas,orhadwithinthepast12months,thefollowingas investment banking client(s):AluminumCorporation of China.Citigroup Global Markets Inc.orits affiliatescurrentlyhas,or had within thepast12months,thefollowingas clients,andthe servicesprovidedwerenon-investment-banking,securities-related:AluminumCorporationofChina.CitigroupGlobal MarketsInc.orits affiliates currentlyhas,or hadwithinthepast12months,thefollowingas clients,and the servicesprovidedwerenon-investment-banking,non-securities-related:AluminumCorporationofChina.Citigroup Global MarketsInc.and/orits affiliates hasa significantfinancial interestinrelationtoAluminumCorporationof China.(Foranexplanationofthedeterminationofsignificantfinancial interest,pleaserefertothepolicyformanagingconflictsofinterestwhich canbefound