According to a report, Morgan Stanley has stated that CHALCO (02600) anticipates its first-half 2026 net profit to increase by 58% to 73% year-on-year, reaching between 11.2 billion and 12.2 billion yuan. This performance aligns with the bank's own projection of 11.7 billion yuan and surpasses general market expectations.

The bank forecasts the company's second-quarter net profit to be between 5.7 billion and 6.7 billion yuan, representing a year-on-year increase of 60% to 89% and a sequential quarterly growth of 3% to 21%.

Key Drivers of Strong Performance

Morgan Stanley attributes the robust profitability primarily to rising aluminum prices during the period, driven by tight overseas supply stemming from Middle East conflicts, coupled with improvements in cost control.

Outlook for the Second Half

The bank expects CHALCO's earnings to remain solid in the second half of the year. It anticipates that aluminum supply and demand will stay relatively tight, providing support for aluminum prices. Further improvements in cost efficiency are also expected to bolster the company's profitability for the remainder of the year.

Consequently, Morgan Stanley maintains its "Overweight" rating on the stock with a target price of HK$11.2.