[ET Net News Agency, 23 October 2019] Huatai Research lifted its target price for Conch
Cement (00914) to HK$46 from HK$45 and maintained its "hold" rating.
The research house said Conch's 3Q net profit of RMB8.55bn (up 10%) was in line with
Huatai's estimate and about 10% ahead of market consensus. The beat was mainly thanks to
the volume-growth acceleration
Gross profit per tonne slimmed by RMB3/t to RMB143/t as an RMB10/t drop in ASP was
partially offset by deft cost control. On higher volume and GP per tonne assumptions,
Huatai raised its 2019/2020 earnings forecasts by 33.8/27.4%.
It said the stronger-than-expected result and continuing cement market strength could
trigger a short-term rally, but Huatai expects concerns on the demand in 2020 to continue
to weigh on the share's performance. (KL)