On June 18, Guosen Securities International published a report resuming coverage of Chinahongqiao and giving it a buy rating with a target price of HKD 17.9. The target price is based on a forecast P/E ratio of 8.5 times for this year, which is one standard deviation higher than the historical average, and against the backdrop of global aluminum supply tension and rising demand. The bank predicts that the prices of electrolytic aluminum and alumina will rise by 4.5% and 10% respectively for the whole year, and will remain high next year. Hongqiao will benefit from a significant expansion of unit profits, mainly due to the company's vertically integrated mode of overseas bauxite equity participation, self-owned power plants, and high proportion of aluminum aquatic products. The bank expects Hongqiao's profits to increase by 61% and 5% annually in the next two years, exceeding market expectations by 6% and 4%, respectively. At the same time, it is expected that every 1% increase in the price of electrolytic aluminum will lead to a 4% increase in Hongqiao's profit. Although the stock price has risen sharply since the beginning of this year, Hongqiao is still at a mid-cycle valuation, and the discount is much larger than that of global peers. The current price of over 7% yield is attractive.