A leader in the aluminum sheet and foil industry. The company was founded in 2007 and listed on A-shares in 2017. It is headquartered in Zhengzhou, Henan. It is a leading enterprise in the diversification of products and the application of recycled aluminum in the aluminum processing industry. It mainly carries out the aluminum plate and foil business. It has 4 hot rolling production lines. Its products sell well in more than 50 countries and regions at home and abroad, and are widely used in many industries such as new energy and electronic appliances. In 2023, the company produced 1.245,000 tons of aluminum sheet foil and sold 1.235,000 tons; aluminum sheet and foil production accounted for 9.8% of the country's total output, leading the industry. In 2023, aluminum sheet/foil contributed 76%/18% to revenue and 69%/23% to gross profit.
Production capacity is expanding steadily. The company is developing a new green aluminum alloy material project with an annual output of 700,000 tons of new green aluminum alloy materials, and is planning a new energy battery material project with an annual output of 250,000 tons, helping the company's production and sales to reach 2 million tons/year as soon as possible and advance to a higher level. In May 2024, the company achieved 129,000 tons of aluminum sheet, foil and aluminum profile production, +23% over the same period last year.
Self-developed production lines have significant cost and quality advantages. The company's 1+4 hot rolling production line is the first self-designed production line in China. After years of operation, it has accumulated rich experience and technology to control various process parameters such as the production speed, temperature, thickness, and plate type of aluminum sheet and foil, and has unique management experience in 1+4 continuous hot rolling production line operation control.
Recycled aluminum applications reinforce cost leadership. The company pioneered the application field of recycled aluminum in 2017. Currently, the recycled aluminum recycling production capacity exceeds 1 million tons. It is the first to achieve large-scale utilization of aluminum resources. It has achieved results in environmental protection and economic benefits. It has become a representative of low carbon energy saving in the industry, and has set a target of 1.4 million tons.
Continuously develop downstream applications. In terms of the aluminum sheet and foil business, various products produced by the company, such as aluminum foil for soft pack batteries, electronic foil, pattern board, lightweight materials for commercial vehicles, food and drug packaging foil, etc., have stabilized at the top of the domestic market share, and the share of high-value-added products such as aluminum for new energy and new materials, aluminum for transportation, and aluminum for lightweight automobiles has gradually increased. In terms of the aluminum profile business, new materials for Mingtai Transportation are operating steadily, rail car body profiles are self-sufficient, aluminum alloy rail bodies are supplied in batches, and products such as extruded aluminum pipes for new energy battery trays, automobile profiles, UHV transmission equipment GIL, and rail vehicle interior parts are sold to the outside world.
First coverage, giving a “buy” rating. Revenue from 2024 to 2026 is expected to be 309/356/40 billion yuan, +17%/15%/12% year on year, and net profit to mother is 17/19.22 billion yuan, +25%/14%/13% year over year, corresponding PE is 9/8/7 times.
Risk warning: New project commissioning falls short of expectations, accounts receivable risk, performance falls short of expectations