MNI China Daily Summary: Wednesday, January 22

MNI BRIEF: China Iron Ore Imports To Remain Positive In 2025

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MNI: PBOC Net Injects CNY198 Bln via OMO Wednesday

EZ/UK Bond Supply Calendar: France, UK Auction on Thursday

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MNI: CANADA DEC INDUSTRIAL PRICES +0.2% MOM; EX-ENERGY +0.4%

MNI EXCLUSIVE: EU-Mercosur Deal Close, But Likely Short-Lived - Officials

AUSTRALIA: 2025 Election Outcome Looking More Uncertain According To Newspoll

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BASIC INDUSTRIES: Norsk Hydro (NHYNO Baa2/BBB/NR): New Deal

BASIC INDUSTRIES
BulletNorwayCEEMEACredit Bullets
  • This is effectively a new name for us, with just the 300m 29s outstanding as long-term Euro debt. It has €500mn 04/25s to refinance.
  • 34% owned by the Norwegian government.
  • As well as mining, sheet metal and extrusions it also has an Energy division which generated 14% of FY23 adj. EBITDA. It benefits from a strong cost position in Aluminium.
  • Hydro’s mining activity is largely concentrated in Bauxite / Alumina, where demand is set to benefit from the energy transition. It’s a smaller scale player than the likes of Glencore, ArcelorMittal and Anglo American.
  • We see LTM adj. net leverage at 1x; it targets < 2x and an investment grade rating. That puts it slightly inside ArcelorMittal (Baa3[P]/BBB-[P]/NR) at 1.3x, which has a history of higher leverage. Glencore (A3/BBB+/NR) has a different business model and runs higher leverage; it also suffers from relatively weak ESG. Anglo spreads benefit from potential renewed interest from BHP.

  • Initial FV thoughts are close to or slightly wide to GLENLN.

    NHYNO metrics
  • NHYNO comps
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  • This is effectively a new name for us, with just the 300m 29s outstanding as long-term Euro debt. It has €500mn 04/25s to refinance.
  • 34% owned by the Norwegian government.
  • As well as mining, sheet metal and extrusions it also has an Energy division which generated 14% of FY23 adj. EBITDA. It benefits from a strong cost position in Aluminium.
  • Hydro’s mining activity is largely concentrated in Bauxite / Alumina, where demand is set to benefit from the energy transition. It’s a smaller scale player than the likes of Glencore, ArcelorMittal and Anglo American.
  • We see LTM adj. net leverage at 1x; it targets < 2x and an investment grade rating. That puts it slightly inside ArcelorMittal (Baa3[P]/BBB-[P]/NR) at 1.3x, which has a history of higher leverage. Glencore (A3/BBB+/NR) has a different business model and runs higher leverage; it also suffers from relatively weak ESG. Anglo spreads benefit from potential renewed interest from BHP.

  • Initial FV thoughts are close to or slightly wide to GLENLN.

    NHYNO metrics
  • NHYNO comps