According to the Zhītōng Cáijīng APP, cement stocks continued to fall recently. As of the posting, CR bldg mat tec (01313) fell by 3.76% to HKD 1.28; Dongwu Cement (00695) fell by 4.29% to HKD 1.56; Asia Cement (00743) fell by 2.43% to HKD 2.81; China National Building Material Company (03323) fell by 1.39% to HKD 2.84.

In terms of news, according to the China Cement Net, the cement industry in the country has seen the second round of large-scale price increases this year since mid to late May. At present, the execution of most of the push-ups in this round in most regions is good, and sales volume also remains stable. However, from the demand side, cement sales are still difficult to improve. Many interviewees believe that cement volume and price are expected to rebound in the second half of the year, but it is expected that the year-on-year cement sales volume will still decline for the entire year.

GF Sec pointed out that cement demand continues to be weak, and the supply-demand contradiction is intensifying. The cement industry's profits are expected to hit bottom in Q1 2024, and in Q2, under the condition of weaker demand, cement companies will reduce production and raise prices to improve profits. Currently, the industry's profits are still oscillating at the bottom, but the cement's off-season price increase shows the determination of enterprises to improve profits, and attention should be paid to the acceleration of the issuance of special bonds bringing back the growth of infrastructure demand. The profit of core companies is better than that of the previous cycle and also better than their counterparts. The current industry valuation is at its historical bottom.