[ET Net News Agency, 7 December 2018] Citi Research lowered its target price for Anhui
Conch Cement (00914) to HK$45.2 from HK$56.7 and downgraded its rating to "neutral" from
"buy".
The research house forecast cement demand will fall 2.2% in 2019, led by a slowdown in
property demand, which would be partly offset by infrastructure demand. Supply discipline
is still effective among the producers.
Citi expects weak property sales will translate into weak new starts, a key property
indicator for cement demand. Infrastructure recovery may take time to materialize and
could only partly offset the decline in property demand. Citi forecast the cement price to
fall 6% YoY in 2019. It expects Conch earnings to peak in 2018 and decline by 18% in 2019.
(KL)