...- China-based primary aluminum producer China Hongqiao Group Ltd. should continue to generate positive discretionary cash flow in 2022-2023, supporting further debt reduction. Favorable aluminum prices and controlled capital expenditure (capex) underpin this forecast. - We see potential execution risks amid Hongqiao's relocation of two thirds of its aluminum capacity to Yunnan province. This is considering the project's large scale and the highly seasonal hydropower, which could disrupt production. - On April 7, 2022, S&P Global Ratings revised its outlook on Hongqiao to positive from stable. We also affirmed our '##-' long-term issuer credit rating on the company and our 'B+' long-term issue rating on the U.S. dollar-denominated senior unsecured notes that Hongqiao issues. - The positive outlook reflects our view that Hongqiao's operating cash flow continues to be sufficient to cover its capex. Its Yunnan project should progress well, absent significant production disruptions. The company...
