Henan Shenhuo Coal & Power Co Ltd

The nonferrous metals sector on the Shenzhen Stock Exchange delivered a strong performance in the first half of 2026. As of August 24, among the 30 companies that had disclosed interim reports, 18 reported earnings growth exceeding 50 percent, and 16 exceeded 100 percent. Hongqiao Holdings achieved revenue of 86.504 billion yuan, up 11.95 percent year on year, with net profit attributable to shareholders of 15.645 billion yuan, up 77.02 percent. Yunnan Aluminium expects net profit attributable to shareholders of 7.5 billion to 7.8 billion yuan, up 170.98 percent to 181.82 percent. Shenhuo Coalfield Power posted net profit attributable to shareholders of 4.781 billion yuan, up 151.06 percent. Tianshan Aluminum reported net profit attributable to shareholders of 4.177 billion yuan, up 100.44 percent. Tongling Nonferrous Metals expects net profit attributable to shareholders of 2.65 billion to 3.15 billion yuan, up 84.13 percent to 118.87 percent. Shanjin International Gold posted net profit attributable to shareholders of 2.416 billion yuan, up 51.43 percent. China Tungsten and Hightech Materials reported net profit attributable to shareholders of 2.076 billion yuan, up 280.53 percent. Continued strength in precious metals prices such as gold and silver, tight supply and demand for industrial metals including copper, aluminum, tin and tungsten, and recovering demand for new energy metals such as lithium and rare earths combined to drive a substantial improvement in industry profitability. Many companies are optimistic about the second half of the year, believing the aluminum industry is likely to maintain a tight supply-demand balance and that electrolytic aluminum prices are expected to remain elevated and volatile.

The electrolytic aluminum sector has recently seen both earnings and share prices rise, with institutions broadly bullish on future opportunities. The Wind Aluminum Industry Index has gained 7.62% over the past month, while Yunnan Aluminum and Shenhuo Coal & Power rose 20.23% and 22.97% respectively over the same period. Yunnan Aluminum expects net profit attributable to shareholders of 7.5 billion to 7.8 billion yuan in the first half of 2026, up 170.98% to 181.82% year-on-year, with second-quarter net profit alone reaching a record high of 3.9 billion to 4.2 billion yuan. Zhongfu Industrial expects first-half net profit of 1.8 billion to 1.95 billion yuan, up 154.42% to 175.62% year-on-year. Tianshan Aluminum expects first-half net profit of 4.2 billion yuan, up 101.52% year-on-year. Soochow Securities noted that the supply-side reform cap of around 45 million tonnes of capacity limits supply, while demand grows steadily, supporting a long-term bull case for aluminum prices. CMB International expects the global electrolytic aluminum supply deficit to widen to 2% of global demand in 2026, mainly due to production disruptions at Middle Eastern smelters, with aluminum prices rising 15% year-on-year. Zhongtai Securities believes that the widening overseas supply deficit will prolong the industry's tight supply-demand situation, and recommends institutional investors actively position in the electrolytic aluminum sector for defense.

Shenhuo Shares released its 2026 interim report, with net profit attributable to the parent company reaching 4.781 billion yuan, a year-on-year increase of 151.06%. Total operating revenue was 24.791 billion yuan, up 21.35% year-on-year, marking two consecutive years of growth. Net cash inflow from operating activities was 7.2 billion yuan, up 62.29% year-on-year. The latest asset-liability ratio stood at 42.32%, a decrease of 11.47 percentage points from the same period last year. Gross margin was 36.17%, rising for five consecutive quarters and up 16.24 percentage points year-on-year.

Shenhuo Shares and Xinyaqiang disclosed their 2026 semi-annual reports on the evening of July 27, while Yishitong and CSPC Innovation released semi-annual earnings forecasts. All four companies showed overall improvement in first-half operating performance. Shenhuo Shares achieved operating revenue of 24.791 billion yuan, up 21.35 percent year-on-year, with net profit attributable to shareholders of 4.781 billion yuan, up 151.06 percent, mainly driven by higher selling prices for coal and electrolytic aluminum and lower alumina prices. Xinyaqiang posted operating revenue of 409 million yuan, up 27.3 percent, and net profit attributable to shareholders of 72.2408 million yuan, up 22.42 percent, as improved supply and demand in the organosilicon industry pushed core product sales to a record high. Yishitong expects operating revenue between 400 million and 420 million yuan, up 47.33 to 54.69 percent, and net profit attributable to shareholders between 9.5 million and 14 million yuan, turning from a loss to a profit year-on-year, benefiting from increased sales of lithium battery coating materials driven by the new energy vehicle and energy storage markets. CSPC Innovation expects net profit attributable to shareholders between 1.18 billion and 1.36 billion yuan, turning from a loss to a profit, as R&D achievements in its biopharmaceutical business continue to materialize.

On the evening of July 27, multiple listed companies on the Shanghai and Shenzhen exchanges released announcements. Orient Securities plans to acquire 100% equity of Shanghai Securities for 25.12 billion yuan, with share consideration of 23.55 billion yuan and cash consideration of 1.57 billion yuan. Guotai Junan Securities has been approved to publicly issue corporate bonds to professional investors totaling no more than 80 billion yuan. China Energy Engineering Corporation signed new contracts worth 513.188 billion yuan in the first half of the year, down 33.81% year-on-year; PowerChina signed new contracts worth 619.893 billion yuan in the first half, down 9.73% year-on-year. Shenhuo Coal Industry and Power reported first-half net profit of 4.781 billion yuan, up 151.06% year-on-year; Dongfang Precision reported first-half net profit of 3.846 billion yuan, up 867.75% year-on-year, and plans to distribute a cash dividend of 2 yuan per 10 shares. Foxconn Industrial Internet plans to repurchase shares worth 1 billion to 2 billion yuan, and iFlytek plans to repurchase shares worth 100 million to 200 million yuan. A controlled subsidiary of Changxin Bochuang signed a long-term cooperation agreement for the sale of optical fiber and cable worth approximately 4.5 billion yuan. In addition, ST Hengxin has been placed under investigation by the China Securities Regulatory Commission for suspected violations of information disclosure laws, and a controlled subsidiary of Beingmate has suspended production due to typhoon and rainstorm, with some assets suffering losses.

Shenhuo Shares disclosed an earnings forecast, expecting a net profit attributable to the parent company of 4.8 billion yuan for the first half of 2026, up 152.04 percent year-on-year, with basic earnings per share of 2.169 yuan. The company stated that during the reporting period, selling prices of electrolytic aluminum and coal products rose year-on-year, while the price of the main raw material alumina fell year-on-year, significantly enhancing profitability.