[ET Net News Agency, 25 June 2019] Morgan Stanley cut its target price for Aluminum
Corp. of China Ltd. (Chalco)(02600) to HK$2.7 from HK$2.8 and maintained its "underweight"
rating.
The research house expects aluminum pricing to remain under pressure due to weak demand
and a continuous decreasing cost curve. It further lowered its aluminum price forecast to
US$0.82/lb in 2019. Morgan therefore slightly lowered Chalco's ASP by 1% in 2019 and 3% in
2020.
As domestic alumina pricing has been boosted by the production suspension due to the red
mud leakage issue in Shanxi, Morgan raised its alumina forecast by 1% in 2019e and lower
our price estimates by 2%/3% in 2020/21.
Helped by slightly higher alumina prices and lower production costs, Morgan lifted its
EPS forecast in 2019 to Rmb0.12/share. EPS forecasts in 2020/2021 dropped 27%/11% to
Rmb0.11 and Rmb0.21, respectively, due to lower price forecasts. (KL)
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02600 CHALCO
Nominal 
5.140 +0.200 (+4.049%) Others
25/06/2019 16:01
[I-bank focus]Morgan Stanley cuts Chalco (02600) to HK$2.7
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