2nd edition of February 18, 2024.
This material is an informational work, which mainly tracks and sorts out the information and data related to the investment in the cement industry sector, provides a reference material, and updates it regularly.
1 General overview of the industry.
1) As a traditional building materials industry in the construction of the national economy, the cement industry is a typical investment-driven industry.
2) China's building materials market throughout the country's six major regional markets, the first region and the low-price area have, its net profit and conch have a certain gap, and the core market of Jidong cement is mainly distributed in North China and Northeast China, a number of regional markets belong to the national cement depression.
3) From the perspective of raw materials, the cement industry, as a large consumer of coal, has a large direct and indirect consumption of coal, and the cost is easily affected by coal. Generally speaking, the cost of coal is 100 yuan tons, and the cost of cement will be about 10 yuan tons.
4) China Cement Network Information Center industry insiders pointed out that, on the whole, due to the increase in investment in energy and environmental protection, coupled with the impact of factors such as investment in technological upgrading, mergers and acquisitions, cement costs have shown an upward trend, and then the overall rise in cement.
5) With the increase of the concentration of the cement industry and the enhancement of market control ability, the cyclical attributes of cement are getting weaker and weaker: on the one hand, the steady growth policy continues to promote the construction of major infrastructure projects, forming a strong support for cement demand; On the other hand, cement companies have upgraded their production equipment with intelligent and energy-saving and consumption-reducing technologies, which has effectively reduced production costs, and the profitability of the industry is expected to gradually recover.
6) China's cement output has been ranking first in the world since 1985, and in recent years, cement output has remained stable at more than 2 billion tons, and the national cement and clinker output in 2022 will be 211.8 billion tons, 139.7 billion tons, a year-on-year decrease of93%。
7) From the perspective of supply, the cement industry has always had the problem of overcapacity, and the capacity utilization rate is basically hovering around 70%, and China's cement production capacity will further increase to 30 in 2022800 million tonnes, while production slipped to 21300 million tons, and the capacity utilization rate dropped sharply to 596%。Correspondingly, cement has continued since 2022, with the maximum decline in the cement index from its high point of 51%.
2 About the basics.
1) The three major carriages that drive cement demand: real estate, infrastructure, and rural markets.
2) China's cement exports are small, mainly to meet domestic demand.
3) Coal and electricity are the main energy sources in the cement industry, and the cost of coal and electricity accounts for about 50% of the total cost of cement production. Once the price of coal and electricity is greatly affected by factors such as policy changes or market supply and demand, it will drive the cost of cement production to rise, and if the resulting cost cannot be fully transmitted to the product, it will have a certain impact on the profitability of cement enterprises.
4) After March, the cement industry usually enters the peak season.
3 Current status and relevant statistics.
3.1 Output, revenue and profit in recent years.
1) In 2018, cement enterprises above designated size achieved main business income of RMB882.3 billion, a year-on-year increase of 25%; profit was 154.6 billion yuan, a year-on-year increase of 114%. Production of cement 2210,000 tons, a year-on-year increase of -53%。
2) In 2019, the revenue of China's cement industry exceeded one trillion yuan for the first time, and the entire industry achieved an operating income of 101 trillion yuan, a year-on-year increase of 125%, profit of 186.7 billion yuan, a year-on-year increase of 196%, another record best. Production of cement 2350,000 tons, a year-on-year increase of 49%。
3) In 2020, China's cement industry will achieve operating income of 996 billion yuan, a year-on-year decrease of 22%, and the profit was 183.3 billion yuan, down 2% year-on-year1%。The production of cement was 240,000 tons, a year-on-year increase of 25%。
4) In 2021, the operating income of the cement industry above designated size will be 1,075.4 billion yuan, a year-on-year increase of 73. The total profit was 169.4 billion yuan, a year-on-year decrease of 100％。Production of cement 23800 million tons, a year-on-year increase of -04%。
5) In 2022, China's cement industry will achieve an operating income of 940 billion yuan, a year-on-year decrease of more than 12%, and a profit of about 69 billion yuan, a year-on-year decrease of about 60%. Production of cement 2130,000 tons, a year-on-year increase of -105%。
3.2 In 2023.
1) It is estimated that the profit of the cement industry in 2023 will be about 32 billion yuan, a year-on-year decrease of about 50%.
Industry trends and outlook
1) Bank of China's ** research report shows that the recent cement in North China ** large**, Hebei Shijiazhuang and Handxing cement enterprises announced a ** increase of 50 yuan tons, and enterprises in the region actively promote the ** increase, mainly to lay the foundation for the start of the market next year. The PB valuation of the cement sector has basically been at the lowest level in history, and we are concerned about the marginal improvement in demand in 2024 and the gradual clearing of the supply side. In the medium and long term, China's urbanization rate still has room for improvement, and the total demand of the cement industry may still have opportunities for improvement and improvement.
2) Wanlian ** research report shows that as the market as a whole enters the closing stage, cement ** is expected to stabilize mainly, and the possibility of price adjustment is small. Tianfeng ** research report shows that the current fundamentals and valuation of traditional building materials are at a relatively low position, the policy has released a positive signal, the industry is expected to gradually improve, it is recommended to pay attention to the expected repair opportunities of building materials. Among them, the cement sector has stronger defensive attributes, and if the demand stabilizes, the industry's first elasticity is not weak, and the stricter environmental protection requirements are also expected to bring about further clearing of the supply side, and pay attention to subsequent policy changes.
Relevant information of listed companies
5.1 aListed companies:A total of 16, including 16 on the main boards of Shanghai and Shenzhen.
There are 10 major state-owned enterprises.
1) 3 central enterprises: Tianshan Co., Ltd., Qilian Mountain, Ningxia Building Materials.
2) 7 local state-owned enterprises: **Tianlu, Conch Cement, BBMG Group, Ningbo Fuda,
Jidong Cement, Qingsong Jianhua, Jianfeng Group.
The situation of leading enterprises
Top 10 companies by market capitalization (as of February 9, 2024).
Conch Cement (128.4 billion), Tianshan (58.9 billion), Huaxin Cement (30.1 billion),
BBMG Group (21.5 billion), CCCC Design (19.5 billion), Jidong Cement (16.5 billion), Sichuan Shuangma (12.8 billion), Tower Group (8.7 billion), Ningxia Building Materials (6.7 billion).
Shangfeng Cement (7.5 billion).
Based on revenue in the first three quarters of 2023Top 10 companies
Conch Cement (99 billion), Tianshan (80.4 billion), BBMG Group (72.6 billion), Huaxin Cement (24.2 billion), Jidong Cement (22.3 billion), Ningxia Building Materials (7.5 billion).
Wan Nianqing (6 billion), CCCC Design (5.7 billion), Shangfeng Cement (4.9 billion),
Tower Group (4.1 billion).
Non-net profit will be deducted for the first three quarters of 2023Top 10 companies
Conch Cement (81.)600 million), Huaxin Cement (18200 million), Sichuan Shuangma (6300 million), Shangfeng Cement (5700 million), CCCC Design (5400 million), Tower Group (5200 million).
Qingsong Jianhua (5100 million), Wan Nianqing (2800 million), Ningxia Building Materials (2600 million).
Ningbo Fuda (1.)500 million).
5.4. Related investment ETF instruments.
1) Building Materials ETF (516750), the top 10 heavy stocks:
Conch Cement, Oriental Yuhong, Beijing New Building Materials, Tianshan Co., Ltd., Weixing New Materials, Kibing Group, 3Trees, Huaxin Cement, Jinyu Group, CSG A.
5.5 Basic information about listed companies.
1) Tower Group. It is the largest cement manufacturing enterprise in eastern Guangdong and the only listed cement company in Guangdong Province. Tower Group has three production bases in Meizhou, Huizhou and Longyan, Fujian, with 7 new dry clinker cement production lines, with an annual output of 18 million tons of cement and 11.63 million tons of clinker, and has 4 brands of "Tower", "Jiaying", "Yueta" and "Hengta", of which "Tower" cement is "Guangdong Famous Brand Product", "Guangdong Famous Trademark" and "Fujian Famous Brand Product".
2) Jidong cement. It is the largest cement producer and merchant in northern China. The main business includes cement manufacturing, clinker, aggregate products, etc. In 2021, Jidong Cement has a clinker production capacity of 11 billion tons, with a production capacity utilization rate of about 7409%;Cement production capacity 17.6 billion tons, with a production capacity utilization rate of about 5509%。Jidong Cement has obvious market share and market competitive advantage in the north, especially in the Beijing-Tianjin-Hebei region, and its cement production capacity ranks third among domestic cement manufacturing enterprises.
3) Huaxin Cement. According to public information, the company's current business covers 16 provinces, municipalities and autonomous regions in China and 14 overseas countries, with more than 300 subsidiaries, and is involved in the integrated development of the whole industrial chain in the fields of cement, concrete, aggregates, environmental protection, equipment manufacturing and engineering, and new building materials. Conch Cement said on the interactive platform that the company will adhere to effective investment, based on the main cement business, strengthen the main cement industry and the upstream and downstream industrial chain, and promote the mutual promotion and coordinated development of the environmental protection industry, new energy industry and digital industry. In terms of the extension of the industrial chain, we will accelerate the development of aggregate and commercial mixed projects around the "extension of the chain and the strengthening of the chain", and give full play to the advantages of industrial synergy and linkage.
4) BBMG Group. On the interactive platform, it was said that the real estate industry is the company's two main businesses in the manufacturing, production and service of new green and environmentally friendly building materials. In 2024, the cement sector will give full play to the reform efficiency of marketing agencies and the role of unifying the large market, further do a good job in market linkage and industry coordination, and make every effort to stabilize the volume and increase prices.
Long-term investment opportunities in the industry
1) Cyclical volatility opportunities. After coming out of the trough in 2015, the cement industry has experienced a six-year high boom by 2021. Profits began to decline in 21 years, and fell sharply for two consecutive years in 22 and 23 years, and the non-net profit deducted by the cement industry in the fourth quarter of 2022 is the lowest base in the four quarters, and the cement industry is still likely to improve in the fourth quarter.
2) Structural opportunities. Opportunities for regional leaders: the cement industry has strong regional characteristics, there is a great difference in net profit between cement listed companies, in addition to the impact of the sales scale between enterprises, the difference between the market areas of the cement is also one of the most important factors.