Summary of Conference Call Notes Company and Industry Overview - The conference involved multiple companies under China National Building Material Group, including Tian Shan Co., Beijing Building Materials, China Jushi, and others, focusing on the building materials industry and its performance in 2024 and outlook for 2025 [1][2][3]. Key Points and Arguments Financial Performance - China National Building Material Group aims for a revenue of 311.7 billion yuan and a profit of 11.2 billion yuan in 2024, with a focus on optimizing its main business structure [4]. - Tian Shan Co. reported a revenue of 8.653 billion yuan in 2024, a decrease of 16.87% year-on-year, with a net profit of 241 million yuan, down 18.82% [21]. - The gross margin for Tian Shan's main products, cement and clinker, was 18.98%, an increase of 1.74 percentage points year-on-year [22]. Industry Trends - The cement industry is expected to see a demand decline of 5% to 8% in 2025, with a significant drop of 5.7% in early 2024 [20]. - The building materials sector is facing challenges due to cyclical and structural issues, leading to increased competition and a need for strategic adjustments [12]. Strategic Initiatives - China National Building Material Group is focusing on high-quality development, emphasizing innovation, digital transformation, and green practices [7][8]. - The company plans to enhance its international presence, with projects in Zambia, Mongolia, and Nigeria, and aims to expand its overseas production capacity [17][18]. - Tian Shan Co. is committed to cost optimization and improving operational efficiency through digital transformation and innovative marketing strategies [14][24]. Technological Advancements - The group is investing in technology innovation, with a focus on producing high-end materials such as OLED glass and carbon fiber [4][9]. - The digital logistics platform "I Find Car" is being optimized to enhance operational efficiency and expand external customer bases [22][29]. Environmental and Governance Focus - The group is committed to sustainable development, with a target to reduce greenhouse gas emissions by 11.99% and improve energy efficiency [15][23]. - ESG governance is being integrated into the company's development strategy, with a focus on enhancing social value [6]. Other Important Insights - The group has a strong market position, with over 60% market share in certain segments, and is leveraging its scale to maintain competitive pricing [36]. - The company is actively pursuing mergers and acquisitions to strengthen its market position and expand its product offerings [39][40]. - The management emphasizes the importance of maintaining product quality and customer service while pursuing growth [39]. This summary encapsulates the key discussions and insights from the conference call, highlighting the financial performance, strategic initiatives, industry trends, technological advancements, and governance focus of the companies involved.

Group 1: Company Strategy and Performance - In 2024, China National Building Material Group's "one body, two wings" strategy achieved new breakthroughs, with the waterproof business experiencing growth despite market challenges [1] - The company plans to continue transformation and innovation in 2025, focusing on marketing innovation and establishing a comprehensive research system [1] Group 2: ESG and Sustainability Initiatives - China National Building Material Group emphasizes "green," "low-carbon," and "ESG" as key themes, with subsidiaries like China Jushi actively promoting ESG ratings through initiatives like a zero-carbon manufacturing base [2] - China National Building Material International is committed to enabling the cement industry to achieve near-zero emissions through technological innovation and energy efficiency improvements [3] Group 3: Industry Consolidation and Restructuring - Ningxia Building Materials is exploring restructuring options to eliminate industry competition, with plans to develop a consolidation scheme that benefits the company and its shareholders [4] - Tianshan Cement has implemented "three precision management" strategies to optimize operations and reduce costs, achieving significant improvements in cost control since its restructuring [5]

Investment Rating - The investment rating for the company is maintained as "Buy" with a target price of HKD 4.79 [8][9]. Core Views - The company reported a revenue of RMB 181.3 billion for 2024, a decrease of 13.8% year-on-year, and a net profit attributable to shareholders of RMB 2.39 billion, down 38.2% year-on-year. The decline in revenue is primarily due to the imbalance in supply and demand in the cement sector, although the new materials and engineering services segments continue to show growth momentum [1]. - The cement segment faced pressure with a total sales volume of 245 million tons in 2024, down 20.7% year-on-year, and an average price of RMB 250.6 per ton, down 7.7% year-on-year. However, since May 2024, there has been a positive trend in price recovery, with an estimated gross profit per ton of RMB 46, reflecting an increase of 8.0% quarter-on-quarter and 48.8% year-on-year [2]. - The new materials segment saw a mixed performance with sales increases in fiberglass, wind turbine blades, and lithium battery separators, while prices decreased significantly. The overall gross margin for this segment was 21.7%, down 3.2 percentage points year-on-year. Price recovery is expected to continue into 2025, improving profitability [3]. - The engineering segment showed stable performance with revenue of RMB 46.1 billion, a year-on-year increase of 0.7%. The international equipment orders have increased, helping to mitigate domestic demand pressures [4]. - The earnings forecast for 2025 has been adjusted upwards, with EPS estimates raised to RMB 0.55 for 2025 and RMB 0.68 for 2026. The target price has been increased by 18% to HKD 4.79, reflecting a 10% discount to the historical average P/E ratio [5]. Summary by Sections Financial Performance - For 2024, the company reported a revenue of RMB 181.3 billion, down 13.8% from 2023, and a net profit of RMB 2.39 billion, down 38.2% year-on-year. The projected revenue for 2025 is RMB 187.85 billion, reflecting a growth of 3.6% [7]. - The EPS for 2024 is projected at RMB 0.28, with a significant increase expected in 2025 to RMB 0.55 [7]. Market Trends - The cement industry is expected to maintain a positive price trend due to ongoing supply-side policies and production adjustments. The average national cement price is projected to decrease by 4.2% quarter-on-quarter but increase by 10.1% year-on-year in Q1 2025 [2]. - The new materials segment is anticipated to improve profitability as price recovery deepens, particularly in fiberglass and gypsum board products [3]. Engineering Services - The engineering and technical services segment reported stable growth, with new orders totaling RMB 63.4 billion, a 3% increase year-on-year. The international market is becoming increasingly important, with overseas orders accounting for 44% of total equipment orders [4].

Financial Performance - Total revenue for 2024 reached RMB 181,301 million, with a net profit attributable to equity holders of RMB 2,387 million[8]. - The company's revenue for 2024 was RMB 181.30 billion, a decrease of 13.8% compared to RMB 210.22 billion in 2023[17]. - Gross profit for 2024 was RMB 32.71 billion, down 12.6% from RMB 37.45 billion in 2023[17]. - Net profit attributable to equity holders was RMB 2.39 billion, a decline of 38.2% from RMB 3.86 billion in the previous year[17]. - The profit attributable to equity holders dropped from RMB 3,863.0 million in 2023 to RMB 2,387.3 million in 2024, a decrease of 38.2%[62]. - Other income increased from RMB 3,454.1 million in 2023 to RMB 5,533.4 million in 2024, an increase of 60.2%[65]. - The sales cost decreased from RMB 172,770.2 million in 2023 to RMB 148,591.4 million in 2024, a decline of 14.0%[64]. Segment Performance - The basic materials segment reported a revenue decline of 23.3%, with revenue of RMB 91,102 million and a loss of RMB 825 million attributable to equity holders[8]. - The new materials segment experienced a revenue increase of 1.9%, generating RMB 48,552 million in revenue but a profit decline of 23.8% to RMB 2,613 million[8]. - The engineering technology services segment saw a revenue growth of 0.8%, with revenue of RMB 45,464 million and a profit decline of 3.1% to RMB 1,407 million[8]. - Revenue from the basic materials segment decreased from RMB 118,800.5 million in 2023 to RMB 91,101.6 million in 2024, a decline of 23.3% due to lower average selling prices and sales volume of cement products[75]. Cash Flow and Debt - The net cash flow from operating activities was RMB 23,196 million, while capital expenditures amounted to RMB 23,501 million[8]. - The net debt ratio stands at 86.6%[8]. - The net debt ratio rose to 86.6% in 2024, up 5.2 percentage points from 81.4% in 2023[18][19]. - The group's net cash inflow from operating activities for 2024 was RMB 23,195.9 million, a decrease of RMB 5,829.0 million compared to RMB 29,024.9 million in 2023[97]. - The group's net cash outflow from investing activities for 2024 was RMB 20,276.7 million, down RMB 7,062.7 million from RMB 27,339.4 million in 2023[98]. - The group's net cash outflow from financing activities for 2024 was RMB 6,569.6 million, an increase of RMB 5,491.5 million compared to RMB 1,078.1 million in 2023[99]. Awards and Recognition - The company received seven major awards in 2024, including recognition for best ESG practices and best board from "Institutional Investor" magazine[6]. - The company ranked 37th in the "Pioneer 100" index for ESG among state-owned enterprises in China[6]. - The company received the Wind ESG AA rating and was selected as one of the "Top 100 ESG Listed Companies in China (2024)" in July 2024[169]. Strategic Initiatives - The company aims to become a world-class materials enterprise focused on value creation and shareholder returns[6]. - The company is actively involved in the development of new technologies and products in the fields of cement, concrete, and glass fiber[6]. - The company is focusing on digitalization, internationalization, and green transformation to enhance competitive advantages[32]. - The company aims to enhance core competitiveness and achieve effective quality improvement and reasonable growth in 2025[28]. - The company is committed to optimizing its layout and improving quality amidst external pressures and internal challenges[32]. Environmental and Social Governance - The company is committed to reducing carbon emissions throughout its operations, focusing on source reduction, process reduction, and end-of-pipe carbon capture[188]. - The company has established a carbon management system and is actively preparing for participation in the national carbon emissions trading market[188]. - The company has implemented a comprehensive environmental protection strategy, including the construction of green factories and mines[187]. - The company replaced 96.81 million tons of standard coal with alternative fuels, contributing to its green transformation efforts[60]. - The nitrogen oxides, sulfur dioxide, and dust emissions decreased by 22.42%, 17.69%, and 32.43% respectively, showcasing improvements in environmental performance[61]. Corporate Governance - The company held 9 board meetings in 2024 to discuss overall strategy, major investments, personnel appointments, and system revisions[108]. - The board of directors consists of five independent non-executive directors, meeting the minimum requirements of the listing rules[116]. - The company has established a set of codes to regulate the securities trading activities of directors and supervisors[107]. - The company has implemented a compliance management and risk management system to strengthen internal controls and adhere to relevant laws and regulations[162]. - The company’s independent non-executive directors receive regular updates on economic, industry, and company information to maintain informed decision-making[152]. Shareholder Information - The company plans to distribute a final dividend of RMB 1,199,697,374.56 (including tax) for the period from January 1, 2024, to December 31, 2024, which translates to RMB 0.158 per share, compared to RMB 0.229 per share in 2023[176]. - The proposed final dividend is subject to approval at the shareholders' annual general meeting on April 25, 2025[178]. - A withholding tax of 10% will be applied to the final dividend for non-resident corporate shareholders listed on the H-share register as of May 12, 2025[178]. - Individual H-share shareholders will have a withholding tax of 20% deducted from their dividends, unless they qualify for lower rates under tax treaties[179].

Financial Performance - The group's audited consolidated revenue for the year ended December 31, 2024, was RMB 181,301 million, a decrease of 13.8% compared to RMB 210,216 million in 2023[3]. - Profit attributable to equity holders for the year was RMB 2,387 million, down 38.2% from RMB 3,863 million in 2023, with basic earnings per share at RMB 0.283, a decline of 38.2% from RMB 0.458[4]. - The group's gross profit for the year was RMB 32,709 million, compared to RMB 37,446 million in 2023, reflecting a decrease in gross margin[4]. - Total comprehensive income for the year was RMB 7,255 million, down from RMB 10,337 million in 2023[5]. - Total revenue for the year ending December 31, 2024, reached RMB 181,300,701 thousand, with external sales contributing RMB 144,687,212 thousand[18]. - The operating profit before interest, tax, depreciation, and amortization (EBITDA) was RMB 28,882,776 thousand, with the cement segment generating RMB 14,860,604 thousand[18]. - The company reported a net profit of RMB 7,413,586 thousand for the year, after tax expenses of RMB 2,079,766 thousand[18]. - The profit before tax for 2024 was RMB 9,493,352,000, a decrease of 24.2% from RMB 12,519,922,000 in 2023[35]. - The net profit margin decreased from 1.8% in 2023 to 1.3% in 2024[93]. - The company reported a net loss of RMB 629 million under expected credit loss model adjustments, contrasting with a gain of RMB 69 million in 2023[4]. Dividends and Shareholder Returns - The board proposed a final dividend of RMB 1,199,697,374.56 (including tax) for the year, translating to a dividend of RMB 0.158 per share, down from RMB 0.229 per share in 2023[3]. - The total amount of proposed final dividends for the year 2024 is RMB 1,199,697,374.56, translating to a dividend of RMB 0.158 per share, compared to RMB 0.229 per share in 2023[127]. - A withholding tax of 10% will be applied to non-resident corporate shareholders receiving the final dividend[129]. - Individual H-share shareholders will have a withholding tax of 20% deducted from their dividends[130]. - The final dividend is expected to be distributed to shareholders listed on the register as of May 12, 2025[135]. - The final dividend is anticipated to be paid on or before June 30, 2025[135]. Assets and Liabilities - Non-current assets increased to RMB 349,967 million from RMB 340,394 million in 2023, driven by growth in property, plant, and equipment[6]. - Current liabilities totaled RMB 181,463 million, slightly up from RMB 176,795 million in 2023, with short-term borrowings increasing to RMB 82,129 million[7]. - The net asset value of the company was RMB 194,528 million, compared to RMB 193,514 million in 2023, indicating a stable financial position[7]. - Total assets amounted to RMB 494,007,276 thousand, with segment assets for cement at RMB 229,610,948 thousand[21]. - The company's total assets reached RMB 488.9 billion, with total liabilities amounting to RMB 295.4 billion, resulting in a debt-to-asset ratio of approximately 60.4%[26]. - Total borrowings increased from RMB 184,905.7 million in 2023 to RMB 191,910.5 million in 2024, with a debt-to-asset ratio of 38.8%[108]. Market and Sales Performance - Total sales for the year 2024 amounted to RMB 181,300,701 thousand, a decrease of 13.8% compared to RMB 210,216,434 thousand in 2023[15]. - Sales of cement products were RMB 154,047,628 thousand in 2024, down from RMB 172,646,629 thousand in 2023, reflecting a decline of 10.8%[15]. - Revenue from engineering services decreased to RMB 24,320,519 thousand in 2024 from RMB 35,026,156 thousand in 2023, representing a decline of 30.5%[15]. - Cement sales volume decreased by 22.4% to 216,523 thousand tons in 2024, while the average selling price dropped by 7.2% to RMB 254.7 per ton[43]. - Revenue from the European market increased significantly to RMB 4.15 billion in 2024, up from RMB 2.14 billion in 2023, marking a growth of 93.5%[28]. Operational and Strategic Initiatives - The company continues to focus on market expansion and new product development strategies to enhance future growth prospects[3]. - The company plans to expand its market presence and enhance product offerings, focusing on new materials and technology services[22]. - The company aims to enhance core competitiveness and maintain a balance between short-term stability and long-term benefits in 2025[48]. - The company is focused on international expansion and accelerating overseas investments and localized operations[47]. - The company is committed to achieving high-quality development and aims to become a world-class materials enterprise[49]. - The company is advancing its "dual carbon" initiatives, with the world's first full oxygen combustion coupled carbon capture production line reaching production capacity[53]. - The company has implemented new disclosure requirements regarding supplier financing arrangements to enhance transparency in financial reporting[10]. Research and Development - The company has filed 1,891 new patents, including 742 invention patents, bringing the total to 16,600 effective patents[77]. - The company published its "2023 Technology Innovation White Paper" and "Green Low-Carbon Technology Achievement Promotion Catalog (2024 Edition)"[81]. - The company emphasizes the importance of technological innovation and green development to empower its growth strategy[119]. Employee and Governance - As of December 31, 2024, the group had unused bank credit and registered but unissued bond quotas totaling approximately RMB 393,067.55 million[106]. - The company emphasizes a performance-based compensation policy linked to overall economic performance, ensuring compliance with national and local labor laws[144]. - The board of directors includes both executive and independent non-executive members, ensuring diverse governance[150]. - The company is committed to improving gender diversity in the workforce, aiming for a better balance in gender representation[145]. Acquisitions and Mergers - The acquisition of Societe Les Ciments de Jbel Oust in Tunisia involves a total consideration of approximately $130 million, with a maximum adjusted price of $145 million[136]. - The acquisition aligns with the company's strategic goals and is expected to accelerate international expansion in the cement market along the Belt and Road Initiative[137]. - The company has decided to terminate the proposed merger with Ningxia Building Materials due to prolonged negotiations and changes in the macro and industry environment[139]. - The company continues to advance the proposed transactions that align with its strategic development direction despite the termination of the merger[139].

Core Viewpoint - The Chinese building materials group is focusing on nurturing and expanding emerging industries and future industries through technological and industrial innovation, which is seen as a core driver for transforming traditional industries and addressing challenges in strategic emerging industries [1] Group 1: Strategic Investments and Developments - The investment in strategic emerging industries by the Chinese building materials group has increased from 34.8% in 2021 to 61.9% in 2024, indicating a strong commitment to industry development [2] - The group has established a 15 billion yuan new materials industry fund to strategically invest in key areas such as semiconductor silicon wafers and photovoltaics [1] - Significant technological breakthroughs have been achieved, including advancements in low heat cement for hydropower projects and composite materials for civil aircraft, supporting major national projects [2] Group 2: Industry Layout and Growth Strategy - The group is adopting a systematic layout and tiered cultivation approach, leveraging the advantages of state-owned capital investment companies to address the rapid technological iteration and long R&D cycles in strategic emerging industries [3] - The company aims to develop a tiered industrial structure with 10 billion to 100 billion yuan segments in areas such as fiberglass, wind turbine blades, and photovoltaic glass [3] - The group plans to continue its dual focus on upgrading traditional building materials and optimizing the layout of strategic emerging industries to drive high-quality development [3][4]

Group 1 - The core viewpoint emphasizes the importance of large scientific facilities as a key support for the innovation efficiency and industrial upgrading in the new materials sector, highlighting the need for better integration between construction and operation, as well as research and engineering [1] - There are over 70 major scientific infrastructure projects in China, placing the country in a leading position globally, but challenges remain in terms of innovation efficiency and the integration of scientific discovery, technological breakthroughs, and industrial upgrades [1] Group 2 - The suggestion includes establishing industry-specific large scientific facility platforms and creating an innovation cluster around comprehensive national scientific centers to stimulate original innovation and facilitate the transformation of results [2] - The focus on material innovation is critical, with an increasing demand for high-quality building materials that meet enhanced functional requirements such as sound insulation, waterproofing, thermal insulation, and energy generation [2] - The proposal advocates for the establishment of a national-level building material application technology innovation center, led by building material and construction companies, to accelerate the development of high-quality material demand systems, application standards, and construction specifications [2]

Investment Rating - The report assigns a "Buy" rating for China National Building Material (CNBM) with a target price of HKD 4.53, based on a 2025 P/E ratio of 8x [7]. Core Views - CNBM is a leading state-owned enterprise in the building materials sector, with significant confidence in its development demonstrated through a large-scale share buyback [1][2]. - The company has faced performance pressures since 2022, but forecasts suggest a potential recovery in profits from 2024 onwards, driven by reduced capital expenditures and financial costs [1][40]. - The report highlights the company's strong market position, with seven business segments ranking first globally, including cement and new materials [1][14]. Summary by Sections 1. Company Overview - CNBM is directly managed by the State-owned Assets Supervision and Administration Commission, with a diversified portfolio across basic building materials, new materials, and engineering services [1][14]. - The company has undergone significant mergers and acquisitions, enhancing its scale and market reach [1][19]. 2. Financial Performance - Revenue projections for 2024-2026 are estimated at CNY 199.3 billion, CNY 216.2 billion, and CNY 229 billion, with corresponding net profits of CNY 1.2 billion, CNY 4.4 billion, and CNY 5.6 billion [11]. - The company has experienced a decline in revenue and profits since 2022, with a notable drop in the basic building materials segment [19][44]. 3. Business Segments Basic Building Materials - The basic building materials segment, primarily cement, has seen a decline in profitability, with a revenue drop of 30.6% year-on-year in the first half of 2024 [3][44]. - The segment's gross margin has decreased significantly, from 27% in 2020 to 8.8% in the first half of 2024 [44]. New Materials - The new materials segment has shown revenue growth, but profits have slightly declined, with a revenue increase of 0.6% year-on-year in the first half of 2024 [4]. - The segment's gross margin was reported at 24% in the first half of 2024 [4]. Engineering Services - The engineering services segment has maintained stable revenue and profit growth, with a revenue increase of 2% year-on-year in the first half of 2024 [5]. - The segment's gross margin has shown a steady increase, reaching 19% [5]. 4. Share Buyback and Valuation - The company announced a share buyback plan to repurchase up to 841,749,304 H shares at a price of HKD 4.03 per share, representing approximately 9.98% of the issued shares [2][26]. - The buyback is expected to enhance shareholder value and improve the company's stock price, which has been trading below its net asset value [2][35].

Investment Rating - The report assigns a "Buy" rating for China National Building Material (CNBM) with a target price of HKD 4.53, based on a 2025 P/E ratio of 8x [7]. Core Views - CNBM is a leading state-owned enterprise in the building materials sector, with significant confidence in its development demonstrated through a large share buyback program [1][2]. - The company has faced performance pressure since 2022, but forecasts suggest a potential recovery in profits due to reduced capital expenditures and financial costs [1][40]. - Revenue projections for 2024-2026 are estimated at HKD 199.3 billion, HKD 216.2 billion, and HKD 229.0 billion, with corresponding net profits of HKD 1.2 billion, HKD 4.4 billion, and HKD 5.6 billion [1][11]. Summary by Sections 1. Company Overview - CNBM is directly managed by the State-owned Assets Supervision and Administration Commission, with operations in basic building materials, new materials, and engineering services [1][14]. - The company has a global leading position in seven business segments, including cement and glass fiber, and operates 13 listed companies [1][14]. 2. Basic Building Materials - The basic building materials segment, primarily cement, has seen declining profitability since 2022, with a revenue drop of 30.6% year-on-year in the first half of 2024 [3][44]. - The segment's gross margin has decreased from 27% in 2020 to 8.8% in the first half of 2024 [3][44]. 3. New Materials - The new materials segment has shown revenue growth, but profits have slightly declined since 2022, with a revenue increase of 0.6% year-on-year in the first half of 2024 [4]. - Revenue projections for this segment from 2024 to 2026 are expected to be HKD 49.6 billion, HKD 59.1 billion, and HKD 62.8 billion, with net profits of HKD 2.7 billion, HKD 3.6 billion, and HKD 4.1 billion respectively [4][16]. 4. Engineering Services - The engineering services segment has maintained stable revenue and has seen a slight increase in profits since 2021, with a revenue increase of 2% year-on-year in the first half of 2024 [5]. - Future revenue estimates for this segment are HKD 50.3 billion, HKD 55.8 billion, and HKD 61.6 billion for 2024-2026, with net profits of HKD 1.5 billion, HKD 1.8 billion, and HKD 1.9 billion [5][16]. 5. Financial Performance and Valuation - The company has experienced a significant decline in net profit, with a forecasted drop of 69% in 2024, followed by a recovery of 262% in 2025 [11]. - The current price-to-book ratio is at a historical low of 0.26x, indicating potential undervaluation [2][35].

Investment Rating - Maintains an "Overweight" rating for the company [4][19] Core Views - The company reported its 2024 interim results, with the basic building materials segment still in loss, but the loss narrowed in Q2 The new materials segment, including fiberglass, blades, and membranes, continues to show incremental growth potential [5][20] - Revenue for the first half of 2024 reached RMB 83 471 billion, up 18 5% YoY, while net profit attributable to the parent company was -RMB 2 018 billion, turning from profit to loss, below expectations [5][20] - The company's cement and clinker sales volume in H1 2024 was 114 million tons, down 19 9% YoY, exceeding the industry's 10% decline in sales volume [5][20] - The new materials segment achieved revenue of RMB 23 55 billion in H1 2024, up 0 6% YoY, with a gross margin of 23 7%, down 2 30 percentage points YoY [5][20] - The engineering services segment achieved revenue of RMB 20 57 billion in H1 2024, up 1 7% YoY, with a gross margin of 18 6%, up 1 0 percentage point YoY [5][20] Financial Summary - Revenue for 2024E is projected to be RMB 183 306 billion, down 13% YoY, with net profit expected to be RMB 1 175 billion, down 70% YoY [7][22] - Revenue for 2025E is projected to be RMB 192 933 billion, up 5% YoY, with net profit expected to be RMB 2 276 billion, up 94% YoY [7][22] - Revenue for 2026E is projected to be RMB 204 757 billion, up 6% YoY, with net profit expected to be RMB 2 987 billion, up 31% YoY [7][22] Valuation and Market Data - The current stock price is HKD 2 20, with a 52-week price range of HKD 2 06-4 11 [6][21] - The current market capitalization is HKD 18 556 billion, with 8 435 million shares outstanding [6][21] - The target price is adjusted to HKD 3 23 based on a 25-year PE of 11 97x for comparable companies [5][20] Industry and Segment Analysis - The cement segment's loss narrowed in Q2, with industry-wide peak-shifting and price increase intentions strengthening in Q3 [5][20] - The new materials segment faces increased competition and price pressure, leading to a decline in profitability despite volume growth [5][20] - The engineering services segment saw growth in overseas and maintenance services, with overseas new contracts up 9% YoY and maintenance new contracts up 41% YoY in H1 2024 [5][20] Capital Expenditure and Financial Health - Capital expenditure in H1 2024 was RMB 13 billion, up 8% YoY, with a shift towards new materials, overseas investments, and equity investments [5][20] - The company's accounts receivable stood at RMB 86 6 billion, down RMB 3 4 billion YoY, with a debt-to-asset ratio of 60%, indicating manageable financial risks [5][20]