UBS released a research report saying that China's cement industry is only in the middle of the downward cycle of structural demand, but evidence of bottoming out is becoming increasingly clear. It is expected that the industry's profitability will bottom out this year and recover slightly from 2027. The bank raised its rating from “sale” to “neutral”, considering that the valuation premium for Conch Cement has generally become normal and the risk and return is more balanced, but the target price was lowered from HK$21.4 to HK$18.2. The bank lowered Hailuo Cement's 2026 and 27 profit forecasts by 16% and 5% to RMB 7.1 billion and RMB 7.5 billion, respectively. The bank also lowered the average price forecast for PO-42.5 cement to RMB 345 per ton to reflect continued competition at low prices. However, it is expected that the price of thermal coal will drop from 750 yuan per ton this year to 720 yuan in 2027. It is believed that lower fuel costs will help gradually recover profits.

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