On July 31, 2026, Nanshan Aluminum International (02610.HK) issued a profit warning, forecasting that the company's equity shareholders' attributable net profit for the first half of 2026 would be approximately $58 million to $68 million, a sharp decline of 72.6% to 76.6% from the $248 million reported in the same period of 2025. As of the close on August 7, the stock price stood at HK$27.82, representing a retreat of more than 60% from its January 2026 high of HK$73. From the initial glory of its listing to the market cap halving after the profit warning, Nanshan Aluminum International is undergoing a classic cyclical baptism.
Listing at the Peak: A Capital Feast at the Cycle's High
Nanshan Aluminum International was listed on the Hong Kong Stock Exchange on March 25, 2025, with an IPO price of HK$26.6. At that time, the alumina market was at a cyclical peak. The company is a subsidiary of A-share Nanshan Aluminum (600219) and primarily operates an alumina project in Indonesia. Leveraging Indonesia's abundant bauxite and coal resources, the company enjoys multiple advantages, including low-cost bauxite supply, short-distance transportation, and tax incentives. The debut performance was not dazzling, with the stock closing at HK$25.25, 5.1% below the IPO price. However, as alumina prices continued to strengthen, the company's capacity expansion progressed smoothly, and it was officially included in the Stock Connect program on September 8, the stock price began a sharp upward cycle. Sustained high earnings growth was the underlying support for the stock price rise. In the first half of 2025, the company achieved revenue of $597 million, a year-on-year increase of 41%; shareholder attributable profit was $248 million, skyrocketing 124.2% year-on-year. For the full year of 2025, the company's revenue reached $1.142 billion, with a net profit attributable to the parent company of $408 million, and a net profit margin as high as 36.62%. At that time, the market gave this Southeast Asian alumina leader a valuation of over HK$40 billion.
The Other Side of the Cycle: Alumina Prices Halved, Profits Plunge
However, cycles are always symmetrical. Entering 2026, the alumina market took a sharp downturn. International alumina market prices continued to fall. In the first quarter of 2026, an announcement from A-share Nanshan Aluminum showed that the per-tonne selling price of overseas alumina powder fell by about 50% year-on-year. In the first half of 2026, the average selling price of Nanshan Aluminum International's products was approximately $320 per tonne, far below the $529 per tonne in the first half of 2025. The selling price was nearly halved, while the per-tonne sales cost remained relatively stable, directly leading to a sharp compression of gross margins. The profit decline in the profit warning—from $248 million to less than $68 million—is a concentrated reflection of this logic. Since 2026, the company has also experienced multiple capital market shocks. On January 22, 2026, the company placed 31 million shares at a placing price of HK$64.5 per share, a discount of 6.39% to the previous day's closing price, raising net proceeds of HK$1.987 billion. After the placement announcement, the stock price fell sharply by over 10% on high volume. On April 28, 2026, affected by the decline in first-quarter performance, the stock price fell another 10%, closing at HK$38.92. From the historical high of HK$73 to the post-profit warning level of less than HK$28, Nanshan Aluminum International's stock price has retreated by more than 60% from its peak, essentially returning to near the IPO price.
Electrolytic Aluminum: A Long-Term Story Catalyst, or a Distant Solution to an Immediate Problem?
At the bottom of the cycle, the market often seeks new growth narratives. Nanshan Aluminum International's answer is electrolytic aluminum. On January 19, 2026, the company announced plans to start preparatory work for a 250,000-tonne-per-year electrolytic aluminum project, with a preliminary estimated investment of approximately $440 million and a construction period of two years. The project site is located in the Karang Batang Special Economic Zone on Bintan Island, where the company's alumina plant is situated. For medium to long-term planning, the company also plans to build an additional 500,000 tonnes of electrolytic aluminum capacity. Leveraging the existing alumina base and the parent company's supporting raw material projects for caustic soda and petroleum coke, the future park is expected to achieve an integrated aluminum layout. However, the electrolytic aluminum project is not expected to contribute profits until 2028 at the earliest. Before that, the company still faces the reality of persistently low alumina prices.
Conclusion
The capital trajectory of Nanshan Aluminum International is a vivid lesson on cycles and valuation. The listing coincided with the peak of the industry cycle, and the market gave a high premium. As the cyclical turning point arrived, alumina prices halved, profits plunged, and the stock price returned to its starting point. The company is seeking to smooth out cyclical fluctuations and open up long-term growth space by laying out electrolytic aluminum—but this is a distant solution to an immediate problem. Before the electrolytic aluminum project is operational in 2028, the company's performance will remain highly tied to alumina prices. For investors, the core question facing Nanshan Aluminum International is: where is the bottom for alumina prices? Until a clear signal of price stabilization and recovery emerges, a low valuation may simply be another expression of a "value trap." For the company's management, how to stabilize the fundamental business at the bottom of the cycle while advancing the long-term strategy of electrolytic aluminum will be the most severe test over the next two years.
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