Investment Rating - The investment rating for the company is "Buy" and it is maintained [4]. Core Views - The company reported a revenue of 3.7 billion HKD for the first half of 2024, representing a year-on-year decline of 16%. The net profit was 390 million HKD, down 27% year-on-year [4][5]. - The cement industry is facing overall operational pressure, with national cement production in the first half of 2024 at 850 million tons, a decrease of 10% year-on-year. The scale of losses in the cement industry is significant, with losses exceeding 3.4 billion HKD [4][5]. - The company's domestic operations are under pressure, while overseas markets are gradually expanding, leading to a slight overall decline in performance [5]. Summary by Sections Financial Performance - The company achieved a revenue of 3.7 billion HKD in H1 2024, down 16% year-on-year, and a net profit of 390 million HKD, down 27% year-on-year [4][5]. Market Conditions - The cement industry is experiencing significant challenges, with a national production decline of 10% and substantial losses reported across the sector [4][5]. - In the company's core market of Shaanxi, fixed asset investment growth was 2.7%, while real estate development investment decreased by 0.4% [4]. Sales and Pricing - The company's total sales volume in H1 2024 was 8.75 million tons, a decrease of 8.3% year-on-year. Domestic sales in Shaanxi, Xinjiang, and Guizhou saw declines of 8.9%, 11.4%, and 32.1% respectively [5]. - Pricing varied by region, with prices in Xinjiang at 409 HKD/ton, Guizhou at 404 HKD/ton, and Shaanxi at 244 HKD/ton, showing a decline in Shaanxi's price compared to the previous year [5]. Capacity and Expansion - The company's total production capacity reached 34.3 million tons as of H1 2024, with significant capacities in various regions including Shaanxi, Xinjiang, and overseas markets [5]. - The overseas market is expected to be a core growth area, with ongoing expansion efforts in Mozambique, Congo, Ethiopia, and Uzbekistan [6]. Future Outlook - The company anticipates steady expansion in overseas markets, with several key projects planned in Ethiopia and ongoing efforts to stabilize operations in Mozambique and Congo [6]. - The projected earnings for 2024-2025 are 900 million HKD and 1.3 billion HKD, with corresponding price-to-earnings ratios of 5 and 3 times, supporting the "Buy" rating [6].
西部水泥：国内经营承压，海外逐步放量