20171024-中国银河国际证券-China_Cement_Weekly__Strong_Share_Price_Performance_before_Q3_Results__Cement_Production_Dropped_2__in_September_12页_858kb

报告摘要

China Cement Weekly Summary - October 23, 2017

Core Content Overview

This report provides an analysis of the performance and market dynamics of the Chinese cement sector, with a focus on share price movements, production data, and valuation metrics of key cement companies.

Key Market Trends

Cement Prices: National cement prices continued to rise, with an average increase of 0.4% week-on-week to RMB342.8/tonne. Prices in Shanghai, Zhejiang, and Jiangsu saw increases of RMB10-30/tonne.
Cement Production: National cement production in September declined by 2% YoY. However, the cumulative production for the first nine months of 2017 (9M17) was down by 0.5% compared to the same period in 2016.
Fixed Asset Investment (FAI): Nationwide FAI grew by 7.5% YoY, with infrastructure leading the growth at 19.8% YoY, while property development saw a 8.1% YoY increase in 9M17.
Land Purchases: Developers purchased more land in terms of area in 9M17 than in 8M17, with a 2.1ppt increase, indicating potential resilience in property sector demand for cement.

Share Price Performance

Cement Stocks: Cement stocks under coverage rose by an average of 10.5% last week, driven partly by upbeat expectations for Q3 results.
Best Performer: CNBM (3323.HK) was the best performer, rising 19.9% week-on-week.
Weakest Performer: BBMG (2009.HK) was the weakest, but still climbed 4.5% week-on-week.
Rating: CNBM is rated "BUY", while BBMG is rated "HOLD" and CR Cement is also rated "BUY".

Valuation Metrics

Company	Ticker	Rating	Price (HK$)	Market Cap (US$m)	2016 PER	2017E PER	2018E PER	2016 BV/EBITDA	2017E BV/EBITDA	2018E BV/EBITDA	Net Debt/Equity (%)
Anhui Conch	914 HK Equity	HOLD	34.40	21,605	18.9	12.4	11.5	10.0	7.4	6.9	Net Cash
ONBM	3323 HK Equity	BUY	6.68	4,624	33.7	10.8	9.3	10.9	8.8	8.2	212
BBMG	2009 HK Equity	HOLD	4.14	8,768	16.6	12.9	10.7	15.8	10.4	8.9	84
CR Cement	1313 HK Equity	BUY	5.29	4,431	18.4	9.5	9.4	10.0	7.0	7.0	42

Peer Comparison

Company	Market Cap (US$m)	2016 PER	2017E PER	2018E PER	2016 EV/EBITDA	2017E EV/EBITDA	2018E EV/EBITDA
Anhui Conch	21,605	18.9	12.4	11.5	10.0	7.4	6.9
ONBM	4,624	33.7	10.8	9.3	10.9	8.8	8.2
BBMG	8,768	16.6	12.9	10.7	15.8	10.4	8.9
CR Cement	4,431	18.4	9.5	9.4	10.0	7.0	7.0
TCC International	2,294	24.3	21.9	20.7	11.2	9.8	9.8
China National Materials	2,518	19.1	11.9	10.6	9.4	6.7	6.5
Asia Cement	573	13.5	11.2	9.5	5.9	5.5	5.6
West China Cement	883	17.1	11.5	9.3	6.3	4.9	4.4
Tianrui Cement	1,665	17.1	11.9	10.6	11.1	9.4	9.1
Simple Average	-	18.2	12.9	11.6	8.8	7.6	7.2
Weighted Average	-	20.0	12.1	11.0	11.1	7.8	7.2

Regional Clinker Capacity Breakdown (2016)

East China:
- Anhui: 44.9%
- CNBM: 40.2%
- CR Cement: 10.9%
- Shanshui: 51.7%
- BBMG: 2.2%
- TCCI: 8.7%
- Asia Cement: 42.0%
- WCC: 0.0%
- Huaxin-Lafarge: 0.0%
- Sinoma Group: 13.9%
South Central China:
- Guangdong: 26.5%
- Guangxi: 15.4%
- Hainan: 16.6%
- Hunan: 10.3%
- Hubei: 5.1%
- Henan: 10.7%
- Total: 100.0%
North China:
- Beijing: 0.0%
- Tianjin: 0.0%
- Hebei: 5.2%
- Shanxi: 12.8%
- Inner Mongolia: 100.0%
- Total: 100.0%
Northeast China:
- Heilongjiang: 20.7%
- Jilin: 11.5%
- Liaoning: 6.5%
- Total: 100.0%
Southwest China:
- Chongqing: 11.2%
- Sichuan: 26.7%
- Guizhou: 26.7%
- Yunnan: 26.7%
- Tibet: 11.2%
- Total: 100.0%
Northwest China:
- Gansu: 8.4%
- Shaanxi: 0.0%
- Qinghai: 0.0%
- Ningxia: 0.0%
- Xinjiang: 28.8%
- Total: 100.0%

Grand Total

Total Clinker Capacity: 100.0%

Market Share in Terms of Clinker Capacity (2016)

East China:
- Anhui: 17.6%
- CNBM: 23.8%
- CR Cement: 1.4%
- Shanshui: 6.2%
- BBMG: 0.4%
- TCCI: 0.8%
- Asia Cement: 1.8%
- WCC: 0.0%
- Huaxin-Lafarge: 0.0%
- Sinoma Group: 2.5%
South Central China:
- Guangdong: 11.8%
- Guangxi: 10.3%
- Hainan: 10.7%
- Hunan: 0.7%
- Hubei: 5.1%
- Henan: 1.2%
- Total: 100.0%
North China:
- Beijing: 0.0%
- Tianjin: 0.0%
- Hebei: 5.7%
- Shanxi: 29.3%
- Inner Mongolia: 100.0%
- Total: 100.0%
Northeast China:
- Heilongjiang: 20.7%
- Jilin: 11.5%
- Liaoning: 6.5%
- Total: 100.0%
Southwest China:
- Chongqing: 11.2%
- Sichuan: 26.7%
- Guizhou: 26.7%
- Yunnan: 26.7%
- Tibet: 11.2%
- Total: 100.0%
Northwest China:
- Gansu: 7.5%
- Shaanxi: 0.0%
- Qinghai: 0.0%
- Ningxia: 0.0%
- Xinjiang: 28.0%
- Total: 100.0%

Grand Total

Total Market Share: 100.0%

Summary of Key Information

Price Trends: Cement prices continued to rise, with regional variations.
Production Trends: National cement production declined in September, but the cumulative 9M17 production was only slightly down.
Demand Outlook: Property development demand for cement is expected to remain strong due to increased land purchases.
Stock Performance: Cement stocks showed strong performance, driven by positive expectations for Q3 results.
Valuation Metrics: The report includes PER and BV/EBITDA ratios for different years, highlighting valuation trends for each company.
Market Share: Companies have varying market shares across different regions, with Anhui Conch and CNBM leading in East China.

Disclaimer

This report is issued by Galaxy International Securities and is not directed at any person or entity in jurisdictions where it may be illegal to distribute or use it. The report is based on information believed to be reliable, but no guarantees are made regarding its accuracy or completeness. No offer or solicitation to buy or sell securities is made in this report. Past performance does not guarantee future results. The report should be read in conjunction with the disclaimer provided.

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