China Hongqiao Unit Posts 38% Profit Jump on Strong Operations

China Hongqiao Group’s core subsidiary reported a 37.6% surge in first-quarter net profit, as the aluminum giant’s operational efficiency improved and shareholder equity grew.

"The improved earnings per share and higher shareholder equity underscore a solid start to 2026 for Hongqiao Holdings, reinforcing China Hongqiao’s financial strength," the company noted in a voluntary update to investors.

Shandong Hongqiao Aluminum Industry Holding Company Limited (002379.SZ), a Shenzhen-listed unit nearly 89% owned by the Hong Kong-based parent, saw net profit climb to RMB 6.76 billion. Revenue for the three months ended March 31 rose 3.2% from a year earlier to RMB 40.93 billion, according to the filing.

The strong results lifted shares in both companies, with China Hongqiao Group (1378.HK) closing up 2.7%. The performance highlights the producer’s robust financial health amid fluctuations in the global industrial metals market.

Stronger Profitability and Efficiency

The company’s financial health was further evidenced by a 15.8% increase in net cash flow from operating activities, which reached RMB 9.24 billion. The weighted average return on equity also showed significant improvement, climbing 2.93 percentage points to 13.81%, signaling stronger profitability.

While total assets saw a slight decline of 1.4% to RMB 109.71 billion, equity attributable to shareholders rose by a substantial 14.7%, underscoring a healthier balance sheet. The results come as analysts maintain a positive outlook on the parent company, with at least one "Buy" rating and a price target of HK$43.90 on the stock, as per data from TipRanks.

The subsidiary's strong start to the year provides a solid foundation for China Hongqiao's consolidated results. Investors will be watching the upcoming annual general meeting for updates on the board, dividend, and share buyback mandate.

This article is for informational purposes only and does not constitute investment advice.