Core Viewpoint - Conch Cement's stock price has shown a positive trend, with a year-to-date increase of 5.69% and a recent uptick in trading activity, indicating strong market interest and potential investor confidence [2][3]. Group 1: Stock Performance - On October 10, Conch Cement's stock rose by 2.03%, reaching a price of 24.13 CNY per share, with a trading volume of 4.87 billion CNY and a turnover rate of 0.51% [1]. - The stock has increased by 5.69% year-to-date, 5.05% over the last five trading days, 3.03% over the last 20 days, and 7.68% over the last 60 days [2]. Group 2: Financial Performance - For the first half of 2025, Conch Cement reported a revenue of 41.292 billion CNY, a year-on-year decrease of 9.38%, while the net profit attributable to shareholders increased by 31.34% to 4.368 billion CNY [2]. Group 3: Shareholder Information - As of June 30, 2025, the number of shareholders for Conch Cement was 224,100, an increase of 7.12% from the previous period [2]. - The company has distributed a total of 83.985 billion CNY in dividends since its A-share listing, with 17.922 billion CNY distributed over the last three years [3]. Group 4: Institutional Holdings - As of June 30, 2025, major shareholders include Hong Kong Central Clearing Limited, holding 193 million shares, and several ETFs such as Huatai-PB CSI 300 ETF and E Fund CSI 300 ETF, which have increased their holdings [3].

Investment Rating - The report maintains an "Overweight" rating for the building materials industry, indicating a positive outlook for the sector's performance relative to the overall market [2][10]. Core Insights - The report highlights that the cement industry is experiencing a traditional seasonal downturn in Q3 2025, with prices expected to decline after peaking earlier in the year. The average cement price in Q3 2025 is projected at 353.1 CNY/ton, down 27.6 CNY/ton from the previous quarter and down 33.5% year-on-year [2][3]. - The report notes that while the cement industry's profitability is under pressure, there are ongoing developments in overseas markets, particularly in Africa, where profitability is expected to improve [2]. - In the fiberglass sector, the report indicates that mid-to-high-end product prices are more resilient, with special fabrics contributing positively to profitability. The report anticipates continued differentiation in the fiberglass market, with low-end products facing weaker profitability [2][3]. - The consumer building materials segment is expected to see strong performance from quality companies, particularly in categories like coatings and tiles, as demand in the residential real estate market remains relatively weak [2]. - The glass industry is facing challenges, with photovoltaic glass prices slightly declining and flat glass prices under pressure. The report suggests that the industry may see a shift towards cleaner production methods, which could improve profitability in the coming years [2]. Summary by Sections Cement - Q3 2025 is a traditional off-season for the cement industry, with prices expected to decline after a peak earlier in the year. The average price is projected at 353.1 CNY/ton, down 27.6 CNY/ton from the previous quarter and down 33.5% year-on-year [2][3]. - The industry is expected to face overall profitability pressure, but overseas expansion, particularly in Africa, shows promise for improved earnings [2]. Fiberglass - Mid-to-high-end fiberglass products are showing stronger price resilience, while low-end products are struggling. The report anticipates continued growth in special fabric sales [2][3]. Consumer Building Materials - Quality companies in the consumer building materials sector are expected to stand out, particularly in categories with strong brand value and retail attributes. Price increases in various segments are anticipated to stabilize in Q3 2025 [2]. Glass - The glass industry is experiencing price declines, particularly in photovoltaic and flat glass. The report suggests a potential shift towards cleaner production methods, which may enhance profitability in the future [2]. Investment Recommendations - The report recommends focusing on companies with improving Q3 performance expectations and strong fundamentals, including major players in the cement, fiberglass, consumer building materials, and glass sectors [2][3].

Market Overview - The cement sector increased by 2.66% on October 9, with Tianshan Co. leading the gains [1] - The Shanghai Composite Index closed at 3933.97, up 1.32%, while the Shenzhen Component Index closed at 13725.56, up 1.47% [1] Individual Stock Performance - Tianshan Co. (000877) closed at 6.57, up 9.14% with a trading volume of 1.4871 million shares [1] - Qingsong Jianhua (600425) closed at 4.68, up 5.64% with a trading volume of 1.2673 million shares [1] - Xibu Construction (002302) closed at 6.94, up 5.31% with a trading volume of 453,600 shares [1] - Wan Nian Qing (000789) closed at 6.04, up 4.14% with a trading volume of 193,400 shares [1] - Other notable performers include Tapai Group (002233) and Sichuan Jinding (600678), with increases of 2.63% and 2.60% respectively [1] Fund Flow Analysis - The cement sector saw a net inflow of 233 million yuan from institutional investors, while retail investors experienced a net outflow of 62.51 million yuan [2] - Major stocks like Tianshan Co. and Conch Cement (600585) had significant fund flow variations, with Tianshan Co. experiencing a net outflow of 90.91 million yuan from institutional investors [3] - Conch Cement had a net inflow of 87.31 million yuan from institutional investors, indicating strong interest [3]

Summary of Key Points from the Conference Call Industry Overview - The conference call focused on the **Greater China Materials** industry, highlighting a **liquidity-driven bull market** supported by **supply disruptions** that are positively impacting commodity prices. The preference is for **gold, copper, and aluminum equities** in this environment [1][4][10]. Core Insights and Arguments - **Commodity Price Forecasts**: - **Aluminum**: Morgan Stanley forecasts $2,659 per ton for 2H2025, which is 6% higher than consensus. For CY2026, the forecast is $2,750, 8% above consensus [10]. - **Copper**: Expected price of $10,047 per ton for 2H2025, 5% above consensus, and $10,650 for CY2026, 9% above consensus [10]. - **Gold**: Projected at $3,719 per ounce for 2H2025, 9% above consensus, and $4,400 for CY2026, 34% above consensus [10]. - **Steel Demand Drivers**: - The **China Steel Demand Drivers** for 2025 include: - **Machinery**: 30% - **Infrastructure**: 17% - **Residential Property**: 14% - **Auto**: 9% [17][19]. - **Copper Consumption Index**: The **China Copper Consumption Index** indicates a significant reliance on sectors such as **Power (47%)**, **White Goods (15%)**, and **Auto (10%)** [21][22]. - **Aluminum Demand Breakdown**: The **China aluminum demand** is driven by: - **Property**: 22% - **Passenger Vehicles**: 20% - **Grid Investment**: 11% [27]. Additional Important Insights - **Infrastructure Spending**: - Infrastructure spending has partially offset the slowdown in new property starts, with a **5.4% YoY increase** in infrastructure spending for the first eight months of 2025 [35][55]. - **Weekly Shipments**: - Weekly cement and rebar shipments in China are being monitored, indicating trends in demand and supply dynamics [55][56]. - **Market Sentiment**: - The overall sentiment in the materials sector remains **attractive**, with Morgan Stanley's research indicating potential conflicts of interest due to business relationships with covered companies [4][5]. - **Analyst Team**: The call featured insights from a team of equity analysts at Morgan Stanley, emphasizing the importance of their research in investment decision-making [3]. This summary encapsulates the key points discussed in the conference call, providing a comprehensive overview of the Greater China Materials industry and its current market dynamics.

Investment Rating - The report maintains an "Outperform" rating for the construction materials sector, indicating expected performance above the market index by more than 10% over the next 6 to 12 months [5][89]. Core Views - The introduction of the "Stabilization Growth Work Plan for the Building Materials Industry (2025-2026)" aims to enhance profitability and strengthen industry management, promoting a competitive environment [1][3]. - Cement prices have seen a significant increase of 1.5% recently, with expectations for further price hikes as companies strive to meet annual growth targets [2][22]. - The glass market is experiencing a slight price increase, supported by downstream replenishment, although demand acceptance at higher prices remains limited [2][37]. - The fiberglass market shows stable pricing for non-alkali yarn, while electronic yarn remains in high demand, indicating a robust market for high-end products [2][54]. Summary by Sections Cement - National cement prices have risen significantly, with a 1.5% increase noted. Companies are expected to continue pushing for price increases as the fourth quarter approaches [2][22]. - The report anticipates that cement companies will maintain upward price momentum to achieve annual growth targets [2][22]. Glass - Float glass prices have shown a slight increase, supported by replenishment from downstream sectors, although the acceptance of high prices is limited [2][37]. - The photovoltaic glass market has seen a slight decline in demand, with inventory levels increasing, but manufacturers are maintaining stable pricing strategies [2][45]. Fiberglass - The price of non-alkali yarn remains stable, with mainstream prices for 2400tex yarn at 3250-3700 CNY/ton, while electronic yarn prices are stable due to high demand in the high-end market [2][54]. Investment Recommendations - The report suggests focusing on the cement and glass sectors due to stricter supply controls and improving profitability. Recommended companies include Conch Cement, Huaxin Cement, and Qibin Group [3][5]. - For fiberglass, companies like China National Materials and China Jushi are highlighted as beneficiaries of structural demand growth [3][5]. - In the construction sector, a recovery in infrastructure investment is anticipated, with recommendations for companies such as China Railway Construction and China State Construction [3][5].

Core Viewpoint - China is the largest producer and consumer of building materials globally, with the cement industry being a significant contributor to energy consumption and carbon emissions, accounting for approximately 9% of the country's total carbon emissions [1][2]. Group 1: Industry Overview - The cement industry was officially included in the national carbon market in March this year [1]. - In 2019, global cement production capacity was 3.7 billion tons, with China accounting for about 60% of this capacity [1]. - The top five cement companies in China by comprehensive strength for 2025 are Conch Cement, China National Building Material Group, Huaxin Cement, Tianshan Cement, and China Resources Cement Technology [1]. Group 2: Greenhouse Gas Emissions - Conch Cement reported a total greenhouse gas emission of 182 million tons of CO2, a decrease of 0.88% year-on-year [5]. - China National Building Material reported emissions of 167 million tons of CO2 equivalent, down 15.3% year-on-year [6]. - Huaxin Cement's emissions were 30.62 million tons of CO2 equivalent, a decrease of approximately 12% [6]. - China Resources Cement Technology reported emissions of 4.0347 million tons of CO2 equivalent, down 3.4% year-on-year [7]. Group 3: Hazardous Waste Generation - China National Building Material generated 11,400 tons of hazardous solid waste, an increase of 38.6% year-on-year, attributed to the acquisition of Beixin Jiaboli [10]. - Conch Cement's hazardous waste generation was 7,849 tons, up 48.6% year-on-year [11]. - China Resources Cement Technology and Huaxin Cement reported hazardous waste generation of 418 tons and 197.19 tons, respectively, with decreases of 5% and 9.7% year-on-year [12]. Group 4: Energy Consumption - Conch Cement's energy consumption was 200 million megawatt-hours, down 2% year-on-year [13]. - China National Building Material reported 182 million megawatt-hours, a decrease of 20.4% [13]. - Huaxin Cement's energy consumption was 5.1951 million tons of standard coal, down 3.4% [13]. - China Resources Cement Technology reported 5.222 million tons of standard coal, down 2.8% [13]. Group 5: Environmental Investment - China National Building Material's total environmental investment for 2024 was 1.964 billion yuan, the highest among the four companies [15]. - Conch Cement invested approximately 846 million yuan in 307 environmental technology renovation projects [15]. - Huaxin Cement's environmental technology investment totaled 707 million yuan, while China Resources Cement Technology's was 320 million yuan [15]. Group 6: Carbon Reduction Initiatives - China National Building Material launched green low-carbon building materials, including recycled materials and alternative fuels [15]. - Tianshan Cement established 89 alternative fuel production lines, with a substitution of 767,000 tons of standard coal and a thermal substitution rate of 4.19% [15]. - Conch Cement aims for a 15% share of alternative fuel usage by 2030, achieving 13% progress last year [15]. - Companies are implementing energy-saving and carbon reduction technology renovations, with various projects leading to significant reductions in energy consumption and emissions [16].

FF301 | 2. 股份分類 | 普通股 | 股份類別 | A | 於香港聯交所上市 (註1) | | 否 | | | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 600585 | 說明 | A股 | | | | | | | | 法定/註冊股份數目 | | 面值 | | 法定/註冊股本 | | | 上月底結存 | | | 3,999,702,579 RMB | | 1 RMB | | 3,999,702,579 | | 增加 / 減少 (-) | | | 0 | | RMB | | | 股份發行人及根據《上市規則》第十九B章上市的香港預託證券發行人的證券變動月報表 截至月份: 2025年9月30日 狀態: 新提交 致：香港交易及結算所有限公司 | 1. 股份分類 | 普通股 | 股份類別 | H | | 於香港聯交所上市 (註1) | | 是 | | | --- | --- | --- | --- | --- | --- | --- | --- | --- | | 證券代號 (如上市) | 00914 | 說明 | H股 | ...

Investment Rating - The industry rating is maintained as "Outperform" [4] Core Insights - The building materials industry saw a significant improvement in net profit in H1 2025, with a year-on-year increase of 23.9%, while revenue decreased by 5.9% to 270.9 billion yuan [12][9] - The cement and fiberglass sectors performed particularly well, with cement profits increasing by 1487% year-on-year in H1 2025 [38][41] - The report indicates that the traditional demand remains weak, but profit growth is driven by price and cost improvements in certain building materials, as well as increased demand for emerging materials [12][9] Summary by Sections 1. Industry Overview - In H1 2025, the building materials industry achieved a total revenue of 270.9 billion yuan, down 5.9% year-on-year, while net profit reached 14.3 billion yuan, up 23.9% [12][9] - The second quarter saw a net profit growth of 30.2% compared to the first quarter, indicating a positive trend [12][9] 2. Subsector Performance - **Cement**: Revenue of 118.1 billion yuan in H1 2025, down 7.7% year-on-year, with net profit soaring by 1487% to 5.2 billion yuan [41][38] - **Consumer Building Materials**: Revenue of 66.9 billion yuan, down 3.8%, with net profit declining by 12.8% [41][38] - **Fiberglass**: Revenue increased by 20.8% to 10.4 billion yuan, with net profit rising by 127% [41][38] - **New Materials**: The electronic materials sector showed significant growth, benefiting from high demand in computing power [41][38] 3. Investment Recommendations - Key stocks recommended include Zhongcai Technology, Huaxin Cement, and China Jushi, among others, with various ratings from "Buy" to "Hold" based on their performance and market conditions [8][41]

Investment Rating - The report maintains a "Buy" rating for the non-metallic building materials sector and an "Overweight" rating for the construction and engineering sector [5]. Core Insights - The Ministry of Industry and Information Technology and five other departments issued the "Building Materials Industry Steady Growth Work Plan (2025-2026)", focusing on quality and efficiency while prohibiting new capacity [2][3]. - The new plan emphasizes the need for coordinated efforts on both supply and demand sides, aiming to enhance profitability levels effectively [3]. - The plan sets a specific target for 2026, aiming for green building material revenue to exceed 300 billion yuan [2]. Summary by Sections Policy Background - The new plan is introduced against a backdrop of weak market demand and prominent structural issues in the building materials industry, contrasting with the previous plan which was released during the early recovery phase post-pandemic [2]. Overall Requirements - The current plan focuses on quality and efficiency, integrating technological and industrial innovation, and emphasizes strict control over new capacity while promoting traditional material upgrades and advanced inorganic non-metallic materials [2][3]. Main Goals - Unlike the previous plan, which set specific growth targets for industrial added value, the current plan does not set total industry targets but emphasizes improving profitability and achieving specific revenue goals for green materials [2]. Key Measures - The new plan prioritizes strengthening industry management and promoting the survival of the fittest, with a focus on strict capacity control in cement and glass production [2][3]. - It outlines specific development directions for advanced materials, including advanced glass, artificial crystals, and high-performance fibers, while promoting pilot platform construction and application verification [3]. Investment Recommendations - The report suggests focusing on companies in the new materials sector such as China Jushi, Guoen Co., Puyang Huicheng, Keda Manufacturing, Hongrun Construction, and Jiemai Technology, as well as companies in the infrastructure and real estate chain like China State Construction, Oriental Yuhong, and Anhui Conch Cement [4].

Group 1 - Cement stocks collectively surged, with Huaxin Cement rising by 5.1% to HKD 15.26, Western Cement up by 5.1% to HKD 3.3, China National Building Material increasing by 3.23% to HKD 5.44, and Conch Cement gaining 1.56% to HKD 23.48 [1] - On September 24, the Ministry of Industry and Information Technology and five other departments released the "Building Materials Industry Stabilization Growth Work Plan (2025-2026)" [1] - Industry insiders expect that the requirement for a capacity replacement plan for excess project filings by the end of 2025 could reduce clinker capacity by 10%, potentially accelerating price recovery in the industry [1] Group 2 - Guosheng Securities reported that the cement industry is still in the process of finding a bottom, with companies increasing staggered production halts, causing cement prices to fluctuate around the industry's breakeven point [1] - The China Cement Association issued a notice to further promote "anti-involution" and "stabilization growth" for high-quality development in the cement industry, indicating potential improvements on the supply side [1] - Large infrastructure projects are expected to boost regional demand in areas like Tibet and Xinjiang, with a focus on leading companies with cost advantages such as Conch Cement and Huaxin Cement [1]