--- title: "CICC: The cement industry benefits from the dual catalysts of the commencement of the Yaxia hydropower project and the \"anti-involution\" policy" type: "News" locale: "en" url: "https://longbridge.com/en/news/249532238.md" description: "CICC released a research report indicating that the downstream hydropower project of the Yarlung Tsangpo River will bring an annual demand of 1-2 million tons to the cement industry, benefiting the cement leaders in the Tibet region. In the short term, the cement industry faces fundamental pressure, but the downside space is limited, and it is recommended to pay attention to the improvement of the medium- and long-term landscape. In addition, the \"anti-involution\" policy will restrict overproduction, becoming the main means of controlling capacity in the industry" datetime: "2025-07-22T08:26:04.000Z" locales: - [zh-CN](https://longbridge.com/zh-CN/news/249532238.md) - [en](https://longbridge.com/en/news/249532238.md) - [zh-HK](https://longbridge.com/zh-HK/news/249532238.md) generator: "portal-rs" --- # CICC: The cement industry benefits from the dual catalysts of the commencement of the Yaxia hydropower project and the "anti-involution" policy According to the Zhitong Finance APP, China International Capital Corporation (CICC) released a research report stating that the downstream hydropower project of the Yarlung Tsangpo River mainly adopts the development methods of straightening bends and tunnel water diversion, constructing five stepped power stations with a total investment of approximately 1.2 trillion yuan. Considering a construction period of about 20 years, it is expected that the Yarlung hydropower project may bring an annual demand of 1-2 million tons to the industry (about 10% of the original cement production in the Tibet region). On the other hand, the "anti-involution" has far-reaching implications for the industry, and in the short term, the cement industry still relies on staggered kiln shutdowns to limit production; in the medium term, limiting overproduction remains the main tool for controlling capacity in the industry. ## CICC's main viewpoints are as follows: **The Yarlung hydropower project is expected to bring an annual demand of 1-2 million tons to the industry, benefiting leading cement companies in the Tibet region.** The downstream hydropower project of the Yarlung Tsangpo River is located in Nyingchi City, Tibet Autonomous Region. The project mainly adopts the development methods of straightening bends and tunnel water diversion, constructing five stepped power stations with a total investment of approximately 1.2 trillion yuan. Considering a construction period of about 20 years, it is expected that the Yarlung hydropower project may bring an annual demand of 1-2 million tons to the industry (about 10% of the original cement production in the Tibet region). In addition, the cement CR3 in the Tibet region reaches 70-80%, and the market liquidity in this area is low, with a relatively favorable competitive landscape. It is judged that this policy may directly benefit leading cement companies in the Tibet region, and it is recommended to pay attention to Huaxin Cement, with other related targets including Tibet Tianlu (not covered). **The "anti-involution" has far-reaching implications for the industry, and limiting overproduction may become the main focus in the near term.** CICC believes that in the short term, the cement industry still relies on staggered kiln shutdowns to limit production; in the medium term, limiting overproduction remains the main tool for controlling capacity in the industry: by 2025, companies need to meet capacity indicators, and the overproduction part must be replaced at a ratio of 1.5:1 or 2:1. Leading companies are actively making up for capacity; for example, Conch Cement has publicly announced that it is transferring a 4500t/d production line, which is being replaced at a 2:1 ratio to two production lines in Huaining, Anhui, with replacement capacities of 1000t/d and 1250t/d, resulting in a net reduction of 2250t/d. In addition, leading cement companies may promote regional integration in the future, gradually eliminating backward capacity. **Short-term fundamentals are under pressure, but the downside space is limited; it is recommended to pay more attention to the improvement of the industry's medium- and long-term landscape.** In the short term, it is judged that there is still pressure on supply and demand in the cement market: according to Zhuochuang Information, as of the week of July 18, the national inclusive tax average price of cement reached 344 yuan/ton, a decrease of 3 yuan/ton; however, at the current point, it is judged that the industry's profit downside space is limited, and it is recommended to pay more attention to the improvement of the industry's medium- and long-term landscape due to the "anti-involution" policy. **Regarding targets** It is recommended to pay attention to Huaxin Cement (600801.SH), Conch Cement (600585.SH), Shangfeng Cement (000672.SZ), and China Resources Cement Technology (01313). Other related targets include Tibet Tianlu (600326.SH). **Risk factors** Infrastructure and real estate demand may fall short of expectations, capacity constraints may be less than expected, and project commencement progress may be slower than expected ### Related Stocks - [600585.CN](https://longbridge.com/en/quote/600585.CN.md) - [00914.HK](https://longbridge.com/en/quote/00914.HK.md) - [600801.CN](https://longbridge.com/en/quote/600801.CN.md) - [06655.HK](https://longbridge.com/en/quote/06655.HK.md) - [000672.CN](https://longbridge.com/en/quote/000672.CN.md) ## Related News & Research - [Anhui Conch Cement files HKEX next-day return disclosing share repurchase for cancellation](https://longbridge.com/en/news/296463043.md) - [Negative Link Announces Global Expansion and Next Phase of Growth](https://longbridge.com/en/news/296644416.md) - [Anhui Conch Cement files HKEX next-day disclosure return on share buyback](https://longbridge.com/en/news/296328897.md) - [Anhui Conch Cement files HKEX next-day disclosure return on share buyback at RMB 17.4](https://longbridge.com/en/news/296197934.md) - [China’s former richest man Zhong Shanshan slams e-commerce platforms for stifling physical retail, worsening price wars](https://longbridge.com/en/news/296298322.md) --- > **Disclaimer: This article is for reference only and does not constitute any investment advice.**