Group 1: Cement Industry - In August, the cement market remained in a seasonal downturn, with high temperatures and rainy weather affecting downstream construction, leading to weak demand and a decrease in operating load of cement mills [1][2] - The average price of cement in August was 271.67 yuan/ton, showing a month-on-month decline [1][2] - A seasonal demand recovery is expected from September to November, combined with the "anti-involution" trend accelerating industry capacity reduction, which may help ease supply-demand imbalances and support price increases [1][2] Group 2: Construction Materials - Retail sales of construction and decoration materials saw a slight decline, with a year-on-year growth of 2.2% from January to July 2025, while July's retail sales decreased by 0.5% year-on-year and 14.45% month-on-month [2] - The ongoing urban renewal initiatives are expected to boost demand for renovation and repair materials, such as pipes, waterproofing, and coatings [2] Group 3: Fiberglass - In August, the pricing of fiberglass roving from small and medium enterprises showed slight weakening, while demand for high-end electronic yarn products remained strong [3] - The supply of traditional electronic yarn products faced pressure, leading to a slight price reduction, but high-end products are expected to see price increases due to demand recovery [3] Group 4: Float Glass - The float glass market continued to experience weak demand, with prices returning to levels seen before previous increases by the end of August [3] - Despite the potential for slight price recovery due to seasonal demand, supply-side pressures remain, limiting significant price increases [3] Group 5: Investment Recommendations - Companies with strong brand advantages and product quality in the construction materials sector, such as Beixin Building Materials, Weixing New Materials, and Dongfang Yuhong, are expected to benefit from urban development focusing on quality improvement [4] - In the cement sector, regional leaders like Shangfeng Cement are recommended, with attention to Huaxin Cement and Conch Cement due to expected profit recovery [5] - For fiberglass, companies like China Jushi are recommended, with a focus on Zhongcai Technology for potential performance recovery [5] - In the glass sector, attention is drawn to Qibin Group as the industry supply-demand dynamics improve [5]

Core Viewpoint - The construction materials industry in China is expected to undergo significant reforms and transformations, focusing on high-quality development, structural optimization, green transition, digital upgrades, and international expansion [1] Group 1: Industry Trends - The cement industry is likely to accelerate capacity reduction under the "anti-involution" backdrop, with the inclusion of cement in the carbon trading market leading to an improved supply-demand structure [1] - Market concentration is expected to increase towards leading enterprises, enhancing their competitive strength [1] Group 2: Emerging Opportunities - The rapid development of emerging industries such as electronic information and new energy will drive the demand for high-end fiberglass products, benefiting companies with technological R&D capabilities and large-scale production advantages [1] Group 3: Strategic Moves by Leading Companies - Leading consumer building material companies are leveraging a dual market strategy of "domestic + overseas" to navigate challenges, promoting "anti-involution" in the domestic market to restore healthy business practices and improve profitability [1] - These companies are also accelerating their overseas capacity layout, with international business expected to become a significant source of future revenue growth [1]

Group 1: Economic Outlook - The expectation for domestic demand is strengthening due to intensified debt reduction policies and a backdrop of overseas interest rate cuts [1][2] - The government aims to establish a debt management mechanism that aligns with high-quality development, focusing on reducing existing hidden debts while promoting economic stability [2] Group 2: Cement Industry - The cement industry is expected to see a gradual recovery in demand as it enters the peak season in September, although growth remains limited [2] - The implementation of policies to restrict overproduction is anticipated to enhance capacity utilization in the medium term, with current low demand and prices [2] - Key companies to watch include Conch Cement and Huaxin Cement [2] Group 3: Glass Industry - The glass industry currently lacks fundamental support, with supply-demand imbalances persisting and limited improvement in downstream demand [3] - The industry is expected to experience bottom-level price fluctuations, with environmental regulations likely to accelerate the pace of industry upgrades [3] - Key company to monitor is Qibin Group [3] Group 4: Fiberglass Industry - The fiberglass sector is experiencing a surge in demand driven by the AI industry, with a notable increase in both volume and price for low dielectric products [3] - The industry is expected to see explosive growth in demand alongside AI advancements [3] - Key companies to focus on include China Jushi and China National Building Material [3] Group 5: Consumer Building Materials - The consumer building materials sector has reached a profitability bottom, with no further downward price pressure expected [3] - The sector is experiencing strong calls for price increases and profitability improvements, with several product categories issuing price increase notices [3] - Key companies to watch include Oriental Yuhong, Skshu Paint, Beixin Building Materials, and Rabbit Baby [3]

Industry Investment Rating - The investment rating for the construction materials industry is "Outperform the Market" and is maintained [1] Core Insights - The report highlights the ongoing implementation of debt reduction policies, emphasizing the need to balance development and safety while enhancing government debt management mechanisms. This is expected to provide strong support for stable economic growth [4] - There is an increasing expectation for domestic demand to strengthen, particularly in sectors such as waterproofing and cement, which are anticipated to benefit significantly from improved cash flow and are currently at the bottom of the industry cycle [4] Summary by Sections Cement - The cement industry is entering a peak season, with overall demand showing slow recovery but limited growth. In August 2025, the monthly cement production was 148 million tons, a year-on-year decrease of 6.2% [5][9] - The implementation of policies to limit overproduction is expected to lead to a continuous decline in capacity, thereby significantly improving capacity utilization [5] Glass - The glass industry is experiencing a downward trend in demand due to the impact of the real estate sector. The demand showed some recovery during the off-season from June to August, but supply-demand conflicts persist [5][14] - The report anticipates that the anti-involution policies will not lead to a blanket removal of capacity but will raise environmental standards and costs, accelerating the industry's cold repair progress [5] Fiberglass - The fiberglass sector is driven by demand from the AI industry, with low dielectric products experiencing a surge in both volume and price. The demand is expected to grow explosively alongside AI developments [5] Consumer Building Materials - The profitability of the consumer building materials sector has reached a bottom, with no further downward price pressure. The industry is seeing a strong push for price increases, particularly in waterproofing, coatings, and gypsum board, leading to expectations of profitability improvement in the second half of the year [6] Market Performance - In the past week (September 8-14), the construction materials sector index increased by 0.89%, while the Shanghai Composite Index rose by 1.52% and the Shenzhen Component Index by 2.65% [7]

Group 1 - The construction materials index increased by 2.45% from September 8 to September 12, 2025, outperforming the CSI 300 index by 1.07 percentage points [1][3] - Over the past three months, the CSI 300 index rose by 15.83%, while the construction materials index increased by 21.65%, indicating a 5.83 percentage point outperformance [1][3] - In the past year, the CSI 300 index has risen by 43.14%, and the construction materials index has increased by 52.13%, showing a 9.00 percentage point outperformance [1][3] Group 2 - Hubei Province has launched a three-year action plan (2025-2027) to promote the green transformation of the construction materials industry, focusing on restructuring the industry [2] - Traditional construction materials will undergo green upgrades, including low-carbon cement and photovoltaic glass [2] - Recommended companies in the consumer building materials sector include Sankeshu, Dongfang Yuhong, Weixing New Materials, and Jianlang Hardware [2] - Beneficiary companies in the cement sector include Conch Cement, Huaxin Cement, and Shangfeng Cement [2] - The glass fiber sector is expected to benefit from favorable tariffs for companies with overseas production bases [2] Group 3 - As of September 12, 2025, the average price of P.O42.5 bulk cement was 275.03 CNY/ton, with a slight increase of 0.01% [5] - The average price of float glass was 1202.33 CNY/ton, reflecting a 1.01% increase [5] - The price of alkali-free 2400tex SMC yarn ranged from 4400 to 5000 CNY/ton, with variations based on region [6] - The price of crude oil was 67.81 USD/barrel, showing a week-on-week increase of 1.65% [6]

Investment Rating - The report maintains a "Neutral" rating for both the real estate and building materials sectors [2][4]. Core Insights - The "anti-involution" policies in the building materials sector are being implemented, leading to improved industry profitability [2]. - Recent policy adjustments in major cities like Shenzhen are expected to stimulate short-term market activity, although long-term recovery will depend on sales data and corporate performance [2][25]. - The cement industry is showing signs of recovery due to self-regulation and cost optimization, with expectations for further profit increases in the second half of 2025 [2][44]. - The glass and fiberglass sectors are experiencing weak supply-demand balance, but potential improvements in demand could lead to price recovery [2][45]. Summary by Sections Real Estate Sector - As of September 11, 2025, the Shenwan Real Estate Index has increased by 2.86% over the past two weeks, outperforming the CSI 300 Index by 1.72 percentage points [11]. - The average price of new residential properties in 100 cities rose by 0.20% month-on-month and 2.73% year-on-year, while second-hand housing prices fell by 0.76% month-on-month and 7.34% year-on-year [23][25]. - Major real estate companies are facing continued pressure, with mid-year losses widening compared to the previous year [25]. - Recommended companies include Poly Developments (600048), Binjiang Group (002244), and China Merchants Shekou (001979) for their strong performance in first and second-tier cities [2][25]. Building Materials Sector - The Shenwan Building Materials Index has increased by 0.31% over the past two weeks, ranking 23rd among 31 sectors [26]. - The average price of cement is currently at 314 RMB/ton, with a slight decrease of 1 RMB/ton from the previous week [30]. - The glass industry is in a weak supply-demand balance, with limited price rebound potential in the short term, but a possible recovery as construction activity increases [45]. - Recommended companies in the cement sector include Conch Cement (600585), Taipai Group (002233), and Huaxin Cement (600801) for their solid fundamentals and attractive dividend yields [44][46].

Investment Rating - The report maintains a "Neutral" rating for both the real estate and building materials sectors [2][4]. Core Insights - The "anti-involution" policies in the building materials sector are being implemented, leading to improved industry profitability [2][4]. - Recent policy adjustments in major cities like Shenzhen are expected to stimulate short-term market activity, although long-term recovery will depend on sales data and corporate performance [2][4][23]. - The cement industry is showing signs of recovery due to self-regulation and cost optimization, with expectations for further profit increases in the second half of the year [2][4][41]. Summary by Sections Real Estate Sector - As of September 11, 2025, the Shenwan Real Estate Index has increased by 2.86% over the past two weeks, outperforming the CSI 300 Index by 1.72 percentage points [11]. - The average price of new residential properties in 100 cities rose by 0.20% month-on-month and 2.73% year-on-year, while second-hand housing prices fell by 0.76% month-on-month and 7.34% year-on-year [21][23]. - The report suggests focusing on stable central state-owned enterprises and regional leaders in first and second-tier cities, such as Poly Developments (600048), Binjiang Group (002244), and China Merchants Shekou (001979) [2][23]. Building Materials Sector - The building materials sector has seen a 0.31% increase over the past two weeks, lagging behind the CSI 300 Index by 0.83 percentage points [24]. - The cement market is currently facing weak demand, with an average price of 314 RMB/ton, down 1 RMB/ton from the previous week [28][30]. - The glass industry is experiencing a weak supply-demand balance, with limited price rebound potential, but there are structural opportunities in the fiberglass sector due to growth in emerging fields like wind power and electric vehicles [42]. - Recommendations for cement companies include Anhui Conch Cement (600585), Taipai Group (002233), and Huaxin Cement (600801) due to their solid fundamentals and attractive dividend yields [41][42].

Core Viewpoint - The construction materials industry is showing various structural highlights in the 2025 mid-year report, with multinational expansion and high-end demand significantly contributing to profitability. Different sub-industries in the domestic market are reaching a consensus on improving profitability, with the pace of profitability recovery potentially outpacing revenue recovery [1]. Group 1: Cement Sector - The cement sector has demonstrated pricing elasticity, with overseas profitability advantages being strong. In Q2 2025, the profitability of the cement industry showed a pattern of high-to-low within the quarter, with April and May continuing the price advantages and raw material cost reductions from Q1, contributing to a year-on-year increase in profitability [2]. - Starting in June, supply-demand pressures increased, leading to a retraction in profitability, but it is confirmed that 2024 is likely the bottom for profit per ton, with further downward pressure being difficult [2]. - The focus on limiting overproduction remains crucial for improving supply-demand dynamics, and there is an expectation for improved shareholder returns driven by industry equity incentives [2]. Group 2: Consumer Building Materials - The profitability recovery in the consumer building materials sector is showing higher elasticity compared to revenue elasticity. In Q2, the revenue growth rate for this sector remained similar to Q1, with expectations that the revenue growth bottomed out in Q3 2024 [3]. - The industry has generally seen some recovery, with price disadvantages year-on-year being a core factor affecting revenue appearance. However, entering Q3, a significant recovery is anticipated due to base effects [3]. - Price recovery and structural upgrades in the coatings and waterproofing sectors are leading the way, while personnel and cost optimizations have significantly improved profitability in the first half of 2025 [3]. Group 3: Glass and Fiberglass - In the fiberglass sector, high-end demand from wind power and thermoplastics is supporting continuous improvement in net profit per ton for leading companies. The demand trend for AI in electronic fabrics is expected to drive both volume and price increases [4]. - The structural upgrade and demand expansion in the specialty electronic fabric sector remain a certain trend, with leading companies deepening their participation [4]. - In the glass sector, the float glass market is experiencing price stabilization amid supply-demand stalemate, while photovoltaic glass has seen slight price rebounds following self-regulated production cuts during extreme losses [4].

Group 1 - The core viewpoint of the article highlights that several companies in the fiberglass industry have raised prices by 5%-10% due to ongoing losses and factors such as US-China tariffs, indicating initial success in industry self-discipline and a potential increase in profitability for the fiberglass sector [1][2] - The China Glass Fiber Industry Association approved the "Self-Discipline Convention for the Glass Fiber and Products Industry" on December 25, 2024, with nine major companies, including China Jushi and Taishan Fiberglass, committing to this self-regulation [1][2] Group 2 - In the construction materials sector, the demand for retail building materials is recovering, supported by high demand in the second-hand housing market and subsidy policies, with strong resilience observed in leading companies [3] - The national average price of cement has decreased by 0.5% week-on-week, with a current price of 343 RMB/ton, while the cement shipment rate stands at 45.73%, indicating a slight recovery in the market [4] - The average price of float glass has weakened slightly, with a current price of 1190 RMB/ton, while photovoltaic glass prices have increased, reflecting mixed market conditions [5] - The price of direct yarn in the fiberglass/carbon-based composite market remains stable, with electronic yarn prices holding steady, indicating a stable market environment for leading companies [6]

Group 1: Industry Overview - The construction materials index decreased by 2.79% from September 1 to September 5, 2025, underperforming the CSI 300 index by 1.98 percentage points [1][3] - Over the past three months, the CSI 300 index increased by 15.24%, while the construction materials index rose by 18.50%, indicating a 3.25 percentage points outperformance of the construction materials sector [1][3] - In the past year, the CSI 300 index has risen by 38.03%, and the construction materials index has increased by 44.25%, with the construction materials sector outperforming the CSI 300 index by 6.21 percentage points [1][3] Group 2: Cement Industry Insights - A joint meeting of cement associations from 28 provinces was held in Linzhi, Tibet, focusing on combating low-price competition and maintaining regional ecology [2] - The meeting emphasized the need for a multi-faceted governance model to address severe overcapacity and frequent low-price dumping in the cement industry [2] - The National Development and Reform Commission has set a target to control cement clinker capacity to around 1.8 billion tons by the end of 2025, with a goal to reduce energy consumption per unit of cement clinker by 3.7% compared to 2020 [2] Group 3: Price Trends - As of September 5, 2025, the average price of P.O42.5 bulk cement was 275.01 CNY per ton, reflecting a 0.21% decrease [4] - The average price of float glass was 1190.25 CNY per ton, with a slight decrease of 0.06% [5] - The price of asphalt remained stable at 4570 CNY per ton, showing a 2.93% increase since the beginning of 2025 [6] Group 4: Recommended Stocks - Recommended stocks in the construction materials sector include Sanhe Tree (for channel expansion), Dongfang Yuhong (for waterproofing), Weixing New Materials (for high retail business proportion), and Jianlang Hardware [2] - Beneficiary stocks in the cement sector include Conch Cement, Huaxin Cement, and Shangfeng Cement [2] - In the fiberglass sector, recommended stocks include China Jushi, with beneficiaries being China National Materials, Changhai Co., and International Composites [2]