Cement stocks are generally weak. As of press time, Dongwu Cement (00695) fell by 5.63% to HKD 1.51; Conch Cement (00914) fell by 3.25% to HKD 18.46; China National Building Material (03323) fell by 2.32% to HKD 2.53.
According to the iFinD app, cement stocks are generally weak. As of press time, Dongwu Cement (00695) fell by 5.63% to HKD 1.51; Conch Cement (00914) fell by 3.25% to HKD 18.46; China National Building Material (03323) fell by 2.32% to HKD 2.53; WestChinaCement (02233) fell by 1.94% to HKD 1.01.
On the news front, Tianfeng Securities issued a research report stating that the cement industry's profits were greatly under pressure in the first half of the year, and companies' profit demands had increased significantly. The bank's statistics show that the combined net income of 13 listed cement companies in the first quarter of 2024 was a loss of 1.5 billion yuan, which is the first quarterly loss since 2016, and the total losses exceeded the previous bottom in 2015-2016. According to the Digital Cement Network, the cement industry incurred losses of 3.4 billion yuan from January to May, and the proportion of companies operating at a loss exceeded 55%.
The bank believes that suspending production during off-peak periods is still a good way to maintain prices in the short term, and the sustainability of price increases depends on changes in inventory. In addition, the bank remains relatively optimistic about cement prices in the second half of the year. On the one hand, under the strong demand for profits, it is expected that the top companies will increase their prices in the second half of the year; on the other hand, it is expected that the year-on-year decline in production in the second half of the year will gradually narrow, and the month-on-month improvement will provide support for price increases.