HuLong Securities: Glass Fiber "Repricing Model" Initiated, Profitability in the Building Materials Industry Expected to Continue Improving

According to the Zhitong Finance APP, Hualong Securities released a research report stating that in the third quarter, the continuous introduction of real estate policies is expected to drive the valuation recovery and improvement of the fundamentals in the building materials industry. In terms of specific segments, in September, the weather continued to improve, and the cement market entered the traditional peak season, but the recovery in demand still appeared insufficient, with a significant year-on-year decline in monthly cement production, although there was a month-on-month rebound. In the glass industry, according to Longzhong Information, the float glass market is expected to enter a volatile trend after a price increase, with some year-end rush demand from downstream, but it is difficult to say it is robust. In the fiberglass industry, after Shandong Glass Fiber raised prices, it triggered the industry's price recovery, and the China Glass Fiber Industry Association responded to counter internal competition, which is expected to enhance the industry's profitability.

Hualong Securities' main viewpoints are as follows:

Building Materials Industry: In the third quarter, central ministries and commissions further improved the top-level design of stable market policies, with local purchase restrictions being relaxed and supporting measures such as optimization of housing provident funds being implemented intensively. Real estate policies continue to exert high intensity. As the revitalization of existing land planning gradually takes effect and the construction of affordable housing and high-quality housing progresses, the industry's inventory pressure is expected to gradually ease. The continuous introduction of real estate policies is expected to drive the valuation recovery and improvement of the fundamentals in the industry, maintaining a "recommended" rating for the building materials industry.

Cement Industry: In September, the weather continued to improve, and the cement market entered the traditional peak season, but the recovery in demand still appeared insufficient, with a significant year-on-year decline in monthly cement production, although there was a month-on-month rebound. The main reasons for the weak demand recovery in September include two aspects: on one hand, investment has declined, and the shortage of project funds has not been substantively alleviated, leading to slow construction progress; on the other hand, frequent rainfall in many areas still affects construction progress due to typhoon disturbances.

According to the actual demand indicator monitored by Digital Cement Network—cement shipment rate, in September, the national average cement shipment rate slightly rebounded month-on-month but decreased by nearly 4 percentage points year-on-year. In the first three quarters, the national average cement shipment rate slightly declined year-on-year, indicating continued demand shrinkage. According to Digital Cement Network data, the average price of cement in the national market in September 2025 was 346.77 yuan/ton, an increase of 5.43 yuan/ton compared to June, with cement demand continuing to operate weakly. Attention should be paid to positive changes on the supply side of the industry, with individual stocks focusing on cement leaders such as Shangfeng Cement (000672.SZ), Huaxin Cement (600801.SH), and Conch Cement (600585.SH).

Glass Industry: According to Longzhong Information, the float glass market is expected to enter a volatile trend after a price increase, with some year-end rush demand from downstream, but it is difficult to say it is robust, and supply pressure still exists, making it likely that prices will fluctuate within a narrow range. On the supply side, there may be both ignition and cold repairs in the next period, but both have strong uncertainties, and daily production is expected to remain above 160,000 tons. On the demand side, some projects awaiting completion provide certain support for demand, but constrained by funding and payment situations, processing enterprises will mainly focus on essential purchases. Additionally, large midstream inventories in some regions will also exert certain pressure on the market. Individual stocks to watch include industry leaders Qibin Group (601636.SH) and Jinjing Technology (600586.SH) Glass Fiber: On September 5th, Shandong Glass Fiber announced a "Price Adjustment Notice," stating that starting immediately, it will adjust the sales prices of certain glass fiber products. Specifically, the prices of direct yarn, light-transmitting board special yarn, short-cut felt special yarn, and other related products will increase by 5%-10% per ton, marking the "first shot" in the glass fiber industry's price recovery.

Coincidentally, the China Glass Fiber Industry Association also released a statement on the same day titled "Initiative to Oppose 'Involutionary' Competition and Jointly Establish and Maintain a Fair and Orderly Competitive Environment in the Glass Fiber and Products Industry." The joint initiative includes key enterprises in the glass fiber industry, such as: Jushi Group, Taishan Glass Fiber, International Composites, Shandong Glass Fiber, Changhai Co., Ltd., Jizhong New Material, Sichuan Weibo, Chongqing Sanlei, and Tianhao Glass Fiber. The industry's price recovery is expected to enhance profitability, with a focus on leading stocks such as China Jushi (600176.SH), Sinoma Technology (002080.SZ), and Honghe Technology (603256.SH).

Consumer Building Materials: Continuous real estate policies are expected to drive industry valuation recovery and fundamental improvement. It is recommended to pay attention to: Weixing New Materials (002372.SZ), Beixin Building Materials (000786.SZ), Sankeshu (603737.SZ), Dongfang Yuhong (002271.SZ), and Jianlang Hardware (002791.SZ).

Risk Warning: Adverse changes in the macro environment; errors in the data sources cited; slower-than-expected progress in infrastructure project construction; market demand falling short of expectations; key companies' performance not meeting expectations; real estate easing policies not meeting expectations