Investment Rating - The industry rating is "Outperform the Market" [7] Core Viewpoints - The report indicates that the real estate market is gradually stabilizing, supported by policies aimed at boosting housing demand and improving purchasing power. This is expected to enhance the overall market sentiment and reduce credit risks for companies in the construction materials sector [5][12] - Short-term pressures for growth have led to renewed emphasis on stabilizing the real estate sector, while medium to long-term monetary and fiscal policy adjustments are anticipated to further support the market [12] - The report highlights that the construction materials sector has limited room for further deterioration compared to the end of 2022, with expectations for both fundamental recovery and valuation improvement [5] Summary by Sections 1. Weekly Insights - As of Q1 2025, the balance of real estate loans in RMB reached 53.54 trillion, with a year-on-year increase of 0.04%. Personal housing loans decreased by 0.8% year-on-year, but the growth rate improved by 0.5 percentage points compared to the end of the previous year [12] - Various local governments have introduced measures to stimulate housing consumption and support the real estate market, including tax adjustments and incentives for home purchases [12] 2. Weekly High-Frequency Data - The average price of bulk P.O 42.5 cement nationwide is 375 RMB/ton, down 0.6% week-on-week and down 5.7% year-on-year [3][13] - The factory price of glass (5.00mm) is 1230 RMB/ton, down 0.3% week-on-week and down 25.9% year-on-year [3][22] 3. Sector Review - The construction materials index increased by 0.18% this week, while the overall market indices saw slight declines [4][54] - Among sub-sectors, other building materials and cement products showed positive performance, while cement manufacturing and glass manufacturing experienced slight declines [4][54] 4. Investment Recommendations - The report suggests focusing on three main investment lines: high-quality companies benefiting from inventory upgrades, undervalued stocks with long-term potential, and leading cyclical building material companies showing signs of bottoming out [5]

Investment Rating - The industry rating is "Outperform the Market" [8][68] Core Viewpoints - In April, the real estate sales heat has declined, but there are expectations for stronger policies in the future. The central bank's vice governor disclosed that personal housing loans increased by 220 billion yuan in Q1, which is over 200 billion yuan more than the previous year. Various cities have introduced new housing policies to support home purchases, indicating a proactive approach to stabilize the real estate market [3][13]. - Short-term factors include the emphasis on stabilizing the real estate sector during the April Politburo meeting, the urgency to expand domestic demand and promote investment amid escalating global trade tensions, and the gradual alleviation of risks associated with major real estate companies, which is beneficial for the building materials sector [3][13]. - Long-term factors suggest that the opening of the interest rate reduction channel in Europe and the US may provide more room for monetary and fiscal policies in China. The Politburo meeting in September 2024 explicitly stated the need to stabilize the real estate market, with expectations for policies such as lowering existing mortgage rates and transaction taxes to support demand [3][13]. Summary by Sections Recent High-frequency Data - As of April 30, 2025, the national average price of bulk P.O 42.5 cement is 395.2 yuan/ton, a decrease of 0.8% from last week, but a year-on-year increase of 13.0%. The average price of glass (5.00mm) is 1275.7 yuan/ton, down 0.2% from last week and down 25.2% year-on-year [4][22]. Sector Review - The Shanghai Composite Index fell by 0.49%, while the Shenzhen Composite Index remained unchanged. The building materials index dropped by 2.14%. Among sub-sectors, refractory materials increased by 1.61%, while cement manufacturing decreased by 2.25% [5][54]. Investment Recommendations - The report suggests focusing on three main lines for investment: 1. High-quality blue-chip stocks benefiting from stock renovation, such as Weixing New Materials, Beixin Building Materials, and Tubao [6]. 2. Undervalued stocks benefiting from the alleviation of B-end credit risks, such as Sankeshu, Dongfang Yuhong, and Jianlang Hardware [6]. 3. Leading cyclical building materials companies with bottoming fundamentals, such as Huaxin Cement, Conch Cement, China Jushi, and Qibin Group [6].

Investment Rating - The industry rating is "Outperform the Market" [8][69] Core Viewpoints - The report highlights that the recent increase in tariffs on Chinese goods by the US and corresponding adjustments by China are expected to boost domestic demand for building materials. The urgency to expand domestic demand and promote investment has intensified due to the escalating global trade war [3][13]. - Short-term factors include the real estate policy window period before the April Politburo meeting, and the gradual alleviation of risks associated with major real estate companies, which is favorable for the building materials sector. In the medium to long term, the opening of the interest rate cut channel in Europe and the US is expected to provide more room for monetary and fiscal policies in China [3][6]. - The report anticipates that the real estate market will stabilize, driven by policies aimed at restoring homebuyer willingness and ability, which will also alleviate credit risks for companies in the industry [6][20]. Summary by Sections Recent Developments - On April 10, the US government announced an increase in tariffs on Chinese imports to 125%, prompting China to respond with similar measures. Additionally, various local governments are implementing policies to support urban renewal and housing market stability [3][13]. - In the first quarter, high-end residential transaction prices in Shanghai increased by 0.5% to 144,600 CNY per square meter, while Shenzhen saw a 67.7% year-on-year increase in new and second-hand residential transactions [3][13]. High-frequency Data - As of April 11, 2025, the national average price of bulk P.O 42.5 cement is 399.0 CNY per ton, showing a 1.2% decrease week-on-week but a 15.0% increase year-on-year. The average price of glass (5.00mm) is 1272.9 CNY per ton, reflecting a 0.3% increase week-on-week but a 26.5% decrease year-on-year [4][21]. Sector Review - From April 7 to April 11, the Shanghai Composite Index fell by 3.11%, while the building materials index decreased by 2.42%. Among sub-sectors, cement manufacturing saw a slight increase of 1.01%, while glass manufacturing declined by 6.21% [5][54]. Investment Recommendations - The report suggests focusing on three main investment lines: high-quality companies benefiting from stock reform, undervalued stocks with long-term alpha attributes, and leading cyclical building material companies showing signs of bottoming out [6][60].