Global Materials | Industrials | Commodities

Rahul Jain

Equity Bottom-Up

<ul>
<li>Vertically integrated Inner Mongolia smelter with second-quartile cost positioning, expanding renewables and alumina self-sufficiency, and entering overseas low-carbon production via its Saudi project.</li>
<li>FY24 margins inflected sharply; mid-cycle valuation implies material upside with strong sensitivity to aluminium pricing and structural demand drivers including AI datacentres, EVs, and grid expansion.</li>
<li>Base-Case Target Price HK$18.6 (24% upside); bull-case HK$22.1; bear-case HK$16.9, supported by integrated operations and medium-term EBITDA expansion potential.</li>
</ul>


Vertically integrated Inner Mongolia smelter with second-quartile cost positioning, expanding renewables and alumina self-sufficiency, and entering overseas low-carbon production via its Saudi project.
FY24 margins inflected sharply; mid-cycle valuation implies material upside with strong sensitivity to aluminium pricing and structural demand drivers including AI datacentres, EVs, and grid expansion.
Base-Case Target Price HK$18.6 (24% upside); bull-case HK$22.1; bear-case HK$16.9, supported by integrated operations and medium-term EBITDA expansion potential.


Chuangxin Industries: Buy – Attractive Cost Positioning and Medium-Term Growth Visibility

APAC IPOs & Placements, Aequitas Research

Nicholas Tan

APAC IPOs & Placements

IPOs and Placements coverage across Asia Pacific

Aequitas Research

We cover all listing across the Asia Pacific along with follow-up placements. As of Dec 2020, our team had covered 539 IPOs with a hit rate of 73.5% and 685 placements with a hit rate of 66.8%.

We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic coverage across new listings and placements. Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis as well.

Equity Capital Markets

Chuangxin Industries / Equity Capital Markets

<ul>
<li>
<a href="https://www.smartkarma.com/entities/chuangxin-industries" target="_blank" data-smartkarma-citation="entities:45636:1" rel="noopener">Chuangxin Industries (CXI HK)</a> raised around US$700m in its upcoming Hong Kong IPO.</li>
<li>It is focused on alumina refining and aluminum smelting within the upstream of the aluminum industry chain.</li>
<li>We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.</li>
</ul>



Chuangxin Industries (CXI HK) raised around US$700m in its upcoming Hong Kong IPO.
It is focused on alumina refining and aluminum smelting within the upstream of the aluminum industry chain.
We have covered various aspects of the deal in our previous note. In this note, we will talk about the demand and trading dynamics.


Chuangxin Industries IPO Trading: Good Insti Sub Rates but Peers Have Traded Down

HK/China Equity Long-Short

Osbert Tang, CFA

<ul>
<li>Despite an overwhelming response and a 26-30% surge in the grey market, at 8.3x FY26 PER,  <a href="https://www.smartkarma.com/entities/chuangxin-industries" target="_blank" data-smartkarma-citation="entities:45636:1" rel="noopener">Chuangxin Industries (2788 HK)</a>'s IPO price does not generate much excitement for us. </li>
<li>Heavy reliance on connected transactions with the controlling shareholder, pressure on margins in the future, and a highly leveraged balance sheet are concerns. </li>
<li>We do not think it justifies trading at a premium to peers, hence, limited upside from now. The small free float, however, will increase the share price volatility.</li>
</ul>


Despite an overwhelming response and a 26-30% surge in the grey market, at 8.3x FY26 PER,  Chuangxin Industries (2788 HK)'s IPO price does not generate much excitement for us. 
Heavy reliance on connected transactions with the controlling shareholder, pressure on margins in the future, and a highly leveraged balance sheet are concerns. 
We do not think it justifies trading at a premium to peers, hence, limited upside from now. The small free float, however, will increase the share price volatility.


Chuangxin Industries (2788 HK): It Doesn't Pay to Be Aggressive

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-hongqiao-group-ltd" target="_blank" data-smartkarma-citation="entities:1909:1" rel="noopener">China Hongqiao (1378 HK)</a> is looking to raise around US$1.2bn from a primary placement.</li>
<li>This represents 9.1 days of the stock’s three month ADV, and 2.9% of total shares outstanding.</li>
<li>In this note, we will talk about the placement and run the deal through our ECM framework.</li>
</ul>



China Hongqiao (1378 HK) is looking to raise around US$1.2bn from a primary placement.
This represents 9.1 days of the stock’s three month ADV, and 2.9% of total shares outstanding.
In this note, we will talk about the placement and run the deal through our ECM framework.


China Hongqiao Placement: Good Valuation but Likely Opportunistic, on the Back of Chuangxin Listing

Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Cross Asset Strategy

<ul>
<li>The Hong Kong Alpha portfolio's performance was -2.01% in October versus returns of -0.81 for the benchmark and -3.53 to  -8.62 for Hong Kong indexes.</li>
<li>The Hong Kong Alpha portfolio has captured most of the market gains and minimized drawdowns since inception. The portfolio's outperformance is more than 40% since inception in October 2024.</li>
<li>At month-end, we reduced materials and healthcare exposure.  We had already reduced the tech exposure earlier in the month.  We established positions in the utility, textile, and battery sectors.</li>
</ul>


The Hong Kong Alpha portfolio's performance was -2.01% in October versus returns of -0.81 for the benchmark and -3.53 to  -8.62 for Hong Kong indexes.
The Hong Kong Alpha portfolio has captured most of the market gains and minimized drawdowns since inception. The portfolio's outperformance is more than 40% since inception in October 2024.
At month-end, we reduced materials and healthcare exposure.  We had already reduced the tech exposure earlier in the month.  We established positions in the utility, textile, and battery sectors.


HONG KONG ALPHA PORTFOLIO: (October 2025)

China

Aluminum Corporation of China Limited manufactures aluminum products. The Company offers aluminum ores, aluminum, bauxite, coal, and other products. Aluminum of China serves coal mining, logistics, and other businesses.

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Aluminum of China (601600 CH)

Chuangxin Industries: Buy – Attractive Cost Positioning and Medium-Term Growth Visibility

Inner Mongolia smelter poised for growth with renewables expansion and overseas projects, FY24 margins strong with potential upside in aluminium...

Rahul Jain

Chuangxin Industries IPO Trading: Good Insti Sub Rates but Peers Have Traded Down

Chuangxin Industries raises US$700m in Hong Kong IPO, focusing on alumina refining and aluminum smelting in the industry chain. Analysis on demand...

Nicholas Tan

Chuangxin Industries (2788 HK): It Doesn't Pay to Be Aggressive

Chuangxin's IPO fails to excite despite a grey market surge, with concerns over connected transactions, margin pressure, and leverage. Limited...

Osbert Tang, CFA

China Hongqiao Placement: Good Valuation but Likely Opportunistic, on the Back of Chuangxin Listing

China Hongqiao is looking to raise around US$1.2bn from a primary placement. In this note, we will talk about the placement and run the deal...

Nicholas Tan

HONG KONG ALPHA PORTFOLIO: (October 2025)

We made mid-month adjustments to the portfolio due to sudden re-escalation of tensions with the US & concurrent sectoral de-rating. Several...

David Mudd

Price Gauge

52-week Range

Market Cap (USDm)

P/E

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Chuangxin Industries: Buy – Attractive Cost Positioning and Medium-Term Growth Visibility

​Inner Mongolia smelter poised for growth with renewables expansion and overseas projects, FY24 margins strong with potential upside in aluminium...

Rahul Jain

Chuangxin Industries IPO Trading: Good Insti Sub Rates but Peers Have Traded Down

​Chuangxin Industries raises US$700m in Hong Kong IPO, focusing on alumina refining and aluminum smelting in the industry chain. Analysis on demand...

Nicholas Tan

Chuangxin Industries (2788 HK): It Doesn't Pay to Be Aggressive

​Chuangxin's IPO fails to excite despite a grey market surge, with concerns over connected transactions, margin pressure, and leverage. Limited...

Osbert Tang, CFA

China Hongqiao Placement: Good Valuation but Likely Opportunistic, on the Back of Chuangxin Listing

China Hongqiao is looking to raise around US$1.2bn from a primary placement. In this note, we will talk about the placement and run the deal...

Nicholas Tan

HONG KONG ALPHA PORTFOLIO: (October 2025)

We made mid-month adjustments to the portfolio due to sudden re-escalation of tensions with the US & concurrent sectoral de-rating. Several...

David Mudd

Inner Mongolia smelter poised for growth with renewables expansion and overseas projects, FY24 margins strong with potential upside in aluminium...

Chuangxin Industries raises US$700m in Hong Kong IPO, focusing on alumina refining and aluminum smelting in the industry chain. Analysis on demand...

Chuangxin's IPO fails to excite despite a grey market surge, with concerns over connected transactions, margin pressure, and leverage. Limited...