GLONGHUI, September 7 | Citigroup released a research report stating that it maintains the “buy” rating of China's building materials. Taking into account its performance in the first half of the year and the latest management guidelines, the target price was lowered from HK$11.1 to HK$9.3. In addition, the Group's profit estimates for 2023-25 were lowered by 46%, 41% and 43%, respectively, reflecting the decline in cement and clinker sales and the pressure on gross profit per unit. The company's management expects that due to the impact of the epidemic, the base for the fourth quarter of last year was low, and that the annual demand for cement may be the same as the same period last year. Management said that since more than half of the producers were losing money, profit margins in the third quarter were under pressure. It is expected that sales prices and gross margin will show an upward trend in the second half of the year, and two rounds of price increases are expected in September. The goal of China's building materials is to be equipped with a coating line with a production capacity of 4 billion square meters by the end of this year, while every 1 billion square meters of production capacity requires an investment of about 3 billion to 3.3 billion yuan.