Deutsche Bank maintains the “hold” rating of Shanshui Cement (00691-HK), with a target price of 3.19 yuan. Shanshui Cement expects its mid-term profit to fall by at least 40%. Deutsche Bank's report indicates surprise. Assuming a decline of 40%, it means that the medium-term earnings per share only reached 35% and 27% of the bank's and market forecasts. It is believed that with the announcement of the results, disappointing earnings will cause the market to further lower its forecast for this stock. According to the report, demand in Shandong Province and Liaoning Province was weak in the first half of the year, and fixed costs were relatively high due to low capacity utilization. Due to the serious overcapacity situation in Shandong, price coordination was not successful, and Shanshui Cement was unable to raise prices during the traditional peak season in the second quarter. The market expects that the overcapacity cannot be resolved quickly, and the province's pricing will remain weak throughout the year. This will put additional pressure on the company's already tight asset table, as its net debt ratio has reached 150%.