CHUANGXIN IND (02788) rose more than 8%, reaching a new peak of HK$32. Since its inclusion in the Stock Connect program on March 9, the stock has accumulated gains exceeding 30%. As of writing, the share price was up 8.01% to HK$31.56, with a turnover of HK$218 million.

Recent developments have heightened concerns over the global aluminum supply chain. Since late February, escalating geopolitical tensions in the Middle East have disrupted shipping through the Strait of Hormuz, and aluminum plants in Qatar and Bahrain have faced force majeure incidents, posing tangible threats to supply.

Zhongyou Securities noted that current aluminum prices only reflect the short-term impact of production halts at the Qatalum and Bahrain aluminum plants. If conflicts persist, rising natural gas power generation costs and raw material shortages could push aluminum prices to ¥30,000 per ton. Even if tensions ease conditionally, aluminum stocks still offer safety margins such as dividends, and renewed expectations of interest rate cuts remain favorable.

Zheshang Securities highlighted that the company benefits from rising aluminum prices driven by improved sector sentiment, lower costs due to declining bauxite prices, and reduced electricity expenses from new energy installations, all contributing to significantly enhanced profitability. Additionally, planned electrolytic aluminum capacity expansions in Saudi Arabia are expected to boost the company’s output, with further increases anticipated by 2027.

The company also demonstrates considerable long-term growth potential. Firms with notable growth prospects in the industry, such as Nanshan Aluminum and Huatong Wire & Cable, currently trade at a valuation premium, with an average forward PE ratio of 28x for 2026.