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　　 Sina tip: This is a research report column, which is only an analyst's personal views and opinions on a stock, not a formal news report. Sina does not guarantee its authenticity and objectivity. All effective information about the stock is subject to the announcement of the Shanghai and Shenzhen Stock Exchanges. Investors are respectfully advised to pay attention to the risks.

He Weijiang of Zhongyuan Securities

Significant losses in the first three quarters. In the first three quarters of 2012, the operating revenue reached 108.833 billion yuan, up 1.13% year on year; The operating cost was 107.277 billion yuan, up 6.42% year on year; The operating profit loss was -5865 billion yuan, and the profit for the same period was 1.759 billion yuan; The net profit loss attributable to shareholders of the listed company was 4.335 billion yuan, compared with a profit of 968 million yuan in the same period.

The booming degree of the aluminum industry declined significantly, leading to the company's substantial losses. In the first three quarters of 2012, the company suffered a large loss, with a net profit loss attributable to shareholders of listed companies of 4.335 billion yuan, the highest in history, which was equivalent to the loss of 4.646 billion yuan in 2009. The sharp decline in the prosperity of the aluminum industry led to the company's substantial losses. In the first three quarters of 2012, the company's comprehensive gross margin level was 2.25%, 1.92 percentage points higher than that in the second quarter, reversing the continuous downward trend since the third quarter of 2011. Judging from the gross profit rate of the company's main products, aluminum oxide and electrolytic aluminum, the gross profit rate in the first half of 2012 was -1.72% and -1.37%, respectively. It is expected that the gross profit rate of aluminum oxide and electrolytic aluminum will improve in the third quarter. In general, since the financial crisis, the company's main products have entered the stage of low gross profit rate. However, the slowdown of China's economic growth in 2012 has exacerbated the industry's operating difficulties, resulting in the company's substantial losses.

The industry prosperity is difficult to recover in the short term. The overall overcapacity of the aluminum industry is large. As of the end of June, the global alumina operating rate was 79%, and China's operating rate was 81.6%; The operating rate of electrolytic aluminum in the world is 82%, and that in China is about 79.9%. At the same time, electrolytic aluminum in western China plans to increase its production capacity by more than 13 million tons, and electrolytic aluminum enterprises in central and eastern China continue to operate with the support of local governments. In the context of China's economic slowdown and sluggish industrial demand, capacity expansion and local protection make it difficult for the aluminum industry to recover in the short term.

Give the company a "overweight" rating. The company suffered losses from 2012 to 2013, and its performance improved next year, but it is difficult to get rid of the losses. It is predicted that earnings per share will be -0.37 yuan and -0.10 yuan. Considering that the company may increase non aluminum assets in the future to improve the structure of operating assets, the investment rating of "increase in holdings" will be given.

Risk tip: The industry prosperity continues to decline, and the company's losses expand.

[Chinalco Bar]