The second quarter losses nearly billion China aluminum industry brewing transformation?

Benefited from the first half of the alumina price and the company's output double upgrade, the aluminum industry in China (601600.　　SH,2600.HK) in the first half of this year to achieve success.　　August 24, the Chinese aluminum industry released 2010.5 Annual report, the company's main income recorded in the first half of the year 59.778 billion yuan, a 113.61% increase over the same period, net profit of 531 million yuan also compared to the same period last year, the loss of 3.499 billion yuan significantly increased, about 0.04 yuan per share earnings. However, Chinalco had made a net profit of 627 million yuan in the first quarter of this year, meaning it was back in losses in the two quarter of this year, with a quarterly loss of 97 million yuan.　　The main reason is that the national Development and Reform Commission in May canceled the electrolytic aluminum industry's preferential electricity prices to improve the cost of electricity, and property regulation led to the collapse of aluminum prices is also an important factor.　　Spurred by the news, Chinalco's H shares and a-shares fell 4.427% and 1.15% respectively, while the foreign investment bank Morgan Stanley downgraded the Chinalco H-share rating to a "reduction", while CICC, the mainland vendor, downgraded the company's earnings forecasts to $0.03 and 0.10 per share this year respectively.　　Under the backdrop of earnings below expectations of about 0.0464 yuan in the first quarter of this year, CICC was expected to achieve earnings per share of about 0.07 yuan in the first half of the year, while Chinalco suffered losses in the second quarter. Overall, alumina is the current Chinese aluminum industry profitability of the business, the first half of this year alumina plate 11.96% operating profit rate is much higher than the electrolytic aluminum industry 5.78%.　　The report revealed that the company's first-half total alumina sales amounted to 15.257 billion yuan, up 57.96% from a year earlier, but due to internal transactions, the first half of the alumina plate recorded 1.035 billion yuan in operating earnings. At the same time, Chinalco's original aluminum plate also benefited from the increase in aluminum prices, the first half of the total sales also appeared year-on-year 85.73% increase, recorded a 1.269 billion yuan operating income.　　However, the raw aluminum in the two quarter since the weak demand and the cancellation of electricity price concessions and other factors such as the sharp decline in profitability, the country Hao's capital even think that the impact of China's aluminum industry "in the third quarter, the opportunity to record losses."　　The cost of alumina and electrolytic aluminum rose 8% and 14% per cent year-on-year in the first half of the year, according to Xiong, chairman of Chinalco, at a 24th performance briefing in Shanghai.　　However, Chen Kihua, vice president of Chinalco, said that although the company suffered a loss of about $500 million in June, it was significantly reduced in July and expressed confidence that it would make a profit in the third quarter and even the second half of the year.　　In contrast, the aluminum processing plate continued the fate of the previous losses, but the first half of this year's loss from the last 412 million yuan narrowed to 142 million yuan; In addition, Chinalco's headquarters and other operating sectors also suffered a loss of 223 million yuan.CICC analyst Cai Hongyu gave Chinalco a forecast of 0.03 yuan per share of the year, which means the company is still struggling to avoid losses in the second half of the year.　　Strategic transformation?　　For Chinalco, many mainland sellers are paying more attention to a takeover at the end of July.　　It is disclosed that Chinalco will jointly establish a joint venture between Rio Tinto and the Rio Tinto Atlantic to jointly develop and operate the world class iron ore project in West Africa, where the company plans to purchase a total of 47% per cent of the joint venture company through a subsidiary instalment of 1.35 billion dollars in phases.　　In fact, as early as this March on the investment of the SIMAO project has been the Chinalco holding shareholder in China Aluminum Company to negotiate.　　It should be said that for Chinalco, which is the main industry of electrolytic aluminum, the sudden involvement in iron ore is clearly not an adjustment to its own business, but a strategic consideration.　　In the analysis of Shi Hengqun Securities, the move is to speed up the strategic transformation from pure aluminum producers to polymetallic minerals, "hoping to take this opportunity to reduce the risk of simply engaging in the aluminum industry and to create a new profit growth point".　　The data from the Securities survey show that, if the estimated resource value of 50 Yuan/ton, the transaction will increase the value of the company's investment of 3.04 yuan/share, while the relatively optimistic state securities believes that 47% of the equity and 2.25 billion tons of iron ore resources equity valuation can thicken the Chinese aluminum industry per share of more than 9.53 yuan.　　In any case, the world's three largest international mining industry has monopolized the global iron ore supply of more than 70% of the background, the participation of Chinalco in the operation of a world-class, high-quality Open-pit iron ore is of great importance to the market, and for Chinalco itself, it is increasingly seen by the market as the beginning of its strategic transformation.　　A recent fund company that has been more concerned about Chinalco said Chinalco would not rule out future development as a holding company and would not even rule out the possibility of a full compression of the development plan for the aluminium industry.　　In fact, China's aluminum industry in Shanxi, Gansu, Qinghai and Inner Mongolia and other land also has a lot of coal resources, its own power plant construction is also expanding.　　In the case of Everbright Securities, the company as an important financing platform for Chinalco, will take advantage of Chinalco's central enterprise background, investment in iron ore, coal, electricity projects, to achieve a comprehensive transformation; "We suspect that there will be some other investment projects such as coal and electricity that will be announced in succession."　　Xiong, chairman of Chinalco, said in a 24th performance announcement that the company was in the new round of negotiations with Queensland, Australia, to form a new project development agreement. In addition to these resources, Chinalco, the Chinalco shareholder, also said in July this year that it was intent to acquire a minority stake in the 29.6%-owned Ivanhoe Mining industry, or to buy from Ivanhoe some of the world's largest Oyu Tolgoi copper-gold mine project.