The company issued a positive profit forecast. Earnings for the five months ended May 31, 2019 increased by about 26% year-on-year, and is expected to record a moderate increase in net profit for the six months ended June 30, 2019. Annual performance is flexible, and profit sustainability is guaranteed. According to the Bureau of Statistics, cement production in Shaanxi Province increased 11.89% year on year from January to May '19. The average retail price of bulk cement in 19H1, 42.5 in representative cities of South Shaanxi & Kanto, was 440 yuan, an increase of 20 yuan over the previous year and 7 yuan over the previous year. The increase in demand mainly comes from infrastructure. We expect the company's net profit to return in 2019-2021 to be 1,721 billion yuan, 1,729 billion yuan, and 1,741 billion yuan, respectively. Performance in 2019 was very flexible, and driven by the construction of national urban agglomerations, the sustainability of cement demand in the medium term is guaranteed. Absolute valuations and relative valuations are still seriously underestimated. Since 2018, we have continued to suggest that there is room for repair in western cement valuations. We recommend that medium- to long-term investors who value absolute returns pay active attention. Recently, the company's stock price has performed well, but from the perspective of absolute and relative valuations, the company's stock price is still seriously underestimated. We estimate that the company's reasonable equity value is 10.049 billion yuan, which is 34% higher than the current value. From a relative valuation perspective, the 2019/7/12 closing price corresponding to 2019E is 3.9X for PE, PB is 0.77X, and EV567 yuan per ton is absolutely undervalued among cement stocks. Our point of view is that the reason limiting valuation recovery is dividends. We expect an operating cash inflow of 2 billion dollars in 2019, which can fully cover capital expenses and planned net debt repayment. The company's dividend ratio is expected to rise to the industry average. From a medium-term perspective, in the next 3-5 years, the company plans to spend 3 billion dollars in capital expenditure. After that, capital expenditure will enter a downward channel. The dividend center is expected to increase steadily, increasing the company's value. We maintain a “prudent increase in holdings” rating with a target price of HK$1.73. Risk warning: deterioration of economic fundamentals, collapse of industry collaboration, large fluctuations in raw material prices, credit risk, equity dispute risk, private enterprise governance risk