中国钢铁行业展望，2025年1月

Investment Rating - The report maintains a stable but weakened investment rating for the steel industry, indicating a decline in overall credit quality but still above a "negative" status [4][5]. Core Viewpoints - The steel industry is expected to face continued pressure on profit margins in 2025 due to persistent supply-demand imbalances and weak recovery in downstream demand, particularly from the real estate sector [4][6]. - Despite some supportive policies for infrastructure and manufacturing, the overall demand for steel is projected to remain weak, with no significant recovery anticipated in 2025 [4][6]. - The industry is entering a phase of reduction and optimization of existing capacity, with a focus on high-end and special steel production to meet the needs of emerging industries [16][30]. Summary by Sections Industry Fundamentals - The steel industry's downstream demand has been weak since 2024, with construction and manufacturing sectors showing limited recovery potential [6][13]. - Real estate remains a major source of steel demand, but investment and construction activities have declined significantly, with new construction area down by 23.0% year-on-year [7][8]. - Infrastructure investment has shown some resilience, with a 9.35% increase in broad infrastructure investment in the first ten months of 2024, providing some support for steel demand [8][9]. Industry Financial Performance - The steel industry has experienced an expanding loss margin in 2024, with operating pressures increasing and financial leverage remaining high [34][39]. - Revenue for sample enterprises in the steel sector decreased by 5.36% year-on-year, with average gross profit margins declining to 6.06% [39][40]. - The number of loss-making enterprises has increased, with 11 companies reporting losses in the first three quarters of 2024, indicating a significant financial strain across the industry [40][41]. Conclusion - The steel industry is expected to remain in a weak operational state in 2025, with limited improvements in profitability due to ongoing supply-demand mismatches and external economic pressures [29][34]. - The report highlights the importance of monitoring credit risks, particularly for companies with continuous losses and weak financial management capabilities [34][43].