HK Stock Market Move | Cement stocks continue to rise, the industry is expected to benefit from the policy of expanding domestic demand, and institutions say that improved profits in the first quarter are worth looking forward to.

The cement stocks continued to rise. As of the time of publication, Huaxin Cement (06655) rose by 8.52% to HK$9.55, Anhui Conch Cement (00914) rose by 7.67% to HK$21.75, CR BLDG MAT TEC (01313) rose by 6.17% to HK$1.72, WESTCHINACEMENT (02233) rose by 5.6% to HK$1.32, and CNBM (03323) rose by 4.32% to HK$3.86. Guosen pointed out that against the backdrop of tariff impact, it is expected that China will introduce more proactive policies to expand domestic demand to counter the decline in external demand. This includes issuing special national bonds to support major strategic construction projects, accelerating the process of local government bond issuance, and increasing financial support for areas such as urban village renovation and idle land reclamation. The construction materials industry, due to its low dependence on external demand, is expected to directly benefit from the expansion of domestic demand policies. Soochow noted that if external demand declines rapidly, infrastructure construction in central and western China is likely to become a urgent rescue direction. Guotai Haitong pointed out that from the perspective of the industrial chain balance sheet, it is highly certain that the pressure on the decline in cement demand will slow down. From the observation at the forefront of the industry, "projects under construction" have contributed important potential for offsetting domestic demand. The hedging initiatives in economic powerhouses like Guangdong may have already been launched ahead of schedule. Looking at the overall cement industry nationwide, the April staggered production plan and the stable price situation have progressed smoothly. The bank pointed out that the resilience and stability of cement demand have been put to the test, and the coal price reductions present an opportunity for the industry to improve its overall situation and turn it into profits. Improvement in profits in the first quarter of 2025 is worth looking forward to.