Chalco 2600

Re: Chalco 2600

Postby winston » Mon Jan 05, 2009 4:09 pm

JPMorgan Chase raises holdings in Chalco

Dec. 29, 2008 (China Knowledge) - U.S.-based financial holding company JPMorgan Chase & Co has raised its shareholding in Aluminum Corp of China Ltd (Chalco)<601600><2600><ACH> to 6.12% from 5.89% on Dec. 18, according to the bourse operator Hong Kong Exchanges and Clearing (HKEx)<388>.

HKEx said in a statement that JPMorgan Chase has acquired 9.2205 million H-shares in Chalco for HK$45.36 million. The average price of the share transaction was HK$ 4.92 apiece.

This is the second time that JPMorgan bought Chalco's H-shares in December.

JPMorgan had acquired 1.184 million H-shares in Chalco for HK$42.39 million or HK$ 3.58 apiece, boosting its holdings in the mainland largest aluminum producer to 5.89% from 4.85%, according to China Knowledge's earlier report.

H-shares of Chalco rose 2.21% to end at HK$4.17 on Dec. 24.
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Re: Chalco 2600

Postby winston » Mon Jan 19, 2009 3:13 pm

China's Chalco raises alumina spot prices by 10 pct

BEIJING (XFN-ASIA) - Aluminum Corp. of China Ltd (Chalco) said it raised its spot alumina price by 10 pct to 2,200 yuan per ton. Chalco, China's top producer, cut its alumina price by 23 pct to 2,000 yuan per ton on Jan 1.
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Re: Chalco 2600

Postby winston » Mon Jan 19, 2009 3:40 pm

DJ Chalco 2008 Net Profit Sharply Lower At CNY2 Bln - Xinhua

BEIJING (Dow Jones)--Aluminum Corp. of China Ltd. (ACH), the country's largest aluminum producer, posted a slump in net profit last year to about CNY2 billion on sharp falls in aluminum and copper prices, Deputy General Manager Lu Youqing said, the official Xinhua News Agency reported Monday.

The company, known as Chalco, posted a net profit for 2007 of CNY10.24 billion. However, the value of the company's gross assets at the end of 2008 had soared 46% to CNY259.5 billion from CNY177.7 billion at the end of 2007, Xinhua said, citing a recent company report. Chalco expects to perform better in the second half of this year than the first half, Xinhua said, citing the company.
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Re: Chalco 2600

Postby winston » Tue Jan 20, 2009 4:24 pm

DJ MARKET TALK: Chalco Off 5.4%;Aluminum Oversupply Persists-BOCI

1455 [Dow Jones] Chalco (2600.HK) down 5.4% at HK$3.67, giving up all of yesterday's gains on news of 10% spot alumina price hike. Despite that and pay cuts, BOCI says stagnant end-user demand, oversupply in China persist, believes Chalco "will struggle to break even this year."

Notes, while aluminum prices have gone up 15% vs trough in mid-December on news Chinese government buying 300,000 tons of aluminum to support industry, purchase represents only 2.1% of annual output. In near term, expects oversupply of aluminum in China will remain overhang; keeps Sell call, HK$1.85 target price, which pegged on 0.4X P/B. Volume modest at HK$160.6 million; intraday low of HK$3.66 immediate support.(
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Re: Chalco 2600

Postby winston » Wed Jan 21, 2009 11:53 am

*Aluminum Corp of China Ltd (Chalco) (2600.HK) (601600.SS) slumped 5.5 percent on a poor industry outlook.

Morgan Stanley said in a research note that Chalco is vulnerable to weak metal prices, and initiated rating the stock as 'underweight' with a price target of HK$3.01, or 22 percent below market price.
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Re: Chalco 2600

Postby winston » Fri Jan 23, 2009 9:49 am

Chalco warns of over 50 pct profit drop in 2008

HONG KONG, Jan 22 (Reuters) - Aluminum Corp of China Ltd (Chalco) (2600.HK)(601600.SS) warned on Thurday that its 2008 net profit may fall more than 50 percent on high production costs and weak demand in the second half.

Chalco, the country's top aluminium firm and the world's third-largest alumina producer, said the forecast was made under Chinese accounting standards.
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Re: Chalco 2600

Postby winston » Sun Jan 25, 2009 7:55 pm

20090116 Macquarie Aluminum Corp of China
No good news for aluminium

Event
We review our earnings estimates for Aluminum Corporation of China (Chalco) to reflect our lower aluminium price forecasts.

Impact
Cutting our aluminium price forecasts: Our commodities team has cut our 2009–11 aluminium price forecasts by 11–22%. We continue to see the aluminium market as massively oversupplied, with prices driven down to levels where around half of the global industry is believed to be losing money on a cash cost basis.

SHFE/LME price differential has narrowed: Shanghai Futures Exchange (SHFE) aluminium prices have typically traded at 10–20% discounts to LME prices in the past few years, which reflects China’s net export position and export taxes. This gap has narrowed in the past two months as higher production costs in China are supporting prices. Local press reports also suggest that the State Reserve Bureau (SRB) is buying 300kt of inventories from major Chinese producers, which has support domestic prices.

Profit warning coming soon? We expect Chalco to post a net loss for 4Q08. Under Chinese listing rules, companies are required to issue profit warnings within one month of the period-end if they expect earnings to drop by 50% YoY or more – and we think Chalco will likely issue a profit warning over the next two weeks. (The full results will be announced in late March.)

Inventory build-up a key risk: At the end of 3Q08, Chalco had Rmb22.7bn of inventories on the balance sheet, which represents almost 40% of their book value. Inventories are recorded at the lower of cost or net realisable value. Given the steep fall in aluminium and raw material prices, we think Chalco may have to take large inventory write-downs at the end of 2008.

Earnings revision
We make minor changes to our forecasts to reflect lower aluminium price forecasts, partially offset by a smaller China price discount to LME.

Price catalyst
12-month price target: HK$2.40 based on a Price to Book methodology.

Catalyst: Worse-than-expected 4Q08 results, continued weakness in aluminium prices.

Action and recommendation

Reiterate Underperform: We expect Chalco to be loss-making in 4Q08 and FY09. It would be the first time the company would report a loss since its IPO. The stock is trading at 0.9x P/BV vs historical lows of 0.45x.
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Re: Chalco 2600

Postby winston » Thu Jan 29, 2009 11:40 am

DJ MARKET TALK: UOB Tips Chalco As Top Sell Among Commodity Plays

0957 [Dow Jones] STOCK CALL: UOB-KayHian tips Chalco (2600.HK) as top Sell among commodity plays. "With LME and SHFE aluminum inventories at all-time highs, and the reopening of aluminum tolling in China, aluminum and alumina prices will remain under pressure." Expects 2008 net profit fall, notes 9M08 earnings down 72%; tips 4Q08 pre-tax loss at CNY1.92 billion, would wipe out bulk of 9M08 net profit of CNY2.6 billion.

Says based on discussion with company, domestic aluminum price still below production cost, alumina just at breakeven despite Chalco's recent 10% alumina price hike; says suggests house's 2009 earnings forecast of CNY660 million remains at risk. "Unless demand firms up dramatically, no matter how much the government tries to help, Chalco's share price will depend on a recovery in property demand and supply constraints." Rates at Sell, target HK$2.50. Shares indicated up 12.2% at HK$3.59 at pre-open.
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Re: Chalco 2600

Postby winston » Mon Feb 09, 2009 12:18 pm

Aluminum Corp of China (Chalco) (2600.HK) surged 7.1 after Goldman Sachs upgraded the stock to buy from neutral, adding the stock to its conviction buy list, as it expects aluminum prices to be supported by huge infrastructure spending in China and stabilisation of the housing construction market.

The stock rose to HK$4.37 on Monday morning, compared with Goldman's target price of HK$5.60.
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Re: Chalco 2600

Postby winston » Wed Feb 11, 2009 10:59 am

DJ MARKET TALK: Chalco Down 1.8% Pre-Open; UOB Keeps Sell Call

0945 [Dow Jones] At pre-open, Chalco (2600.HK) bid down 1.8% at HK$4.29 on resuming trade, tracking overall market weakness, but mostly ignoring news it hasn't made senior management changes; psychological support of HK$4.00 unlikely to be troubled.

Still, UOB KayHian remains fundamentally bearish on Chalco, keeps Sell call with HK$3.00 fair price, citing China's record 33% idle aluminum capacity, all-time high global inventories
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