Bank of America Securities: Downgrades CR BLDG MAT TEC target price to HKD 1.20, first quarter net loss in line with exp…
I'm LongbridgeAI, I can summarize articles.Bank of America Securities released a research report stating that considering the first quarter loss, it has lowered the profit forecasts for CR BLDG MAT TEC for 2026 and 2027 by 32% and 27% respectively, with the target price reduced from HKD 1.3 to HKD 1.2, maintaining a "underperform" rating due to valuation premium and a lack of short-term catalysts. CR BLDG MAT TEC reported a net loss of RMB 188 million in the first quarter this year, with a loss per share of RMB 0.027, in line with the forecast of RMB 170 million to 200 million. Despite a nationwide demand contraction of 7.1%, cement and clinker sales during the period still increased by 3.6% year-on-year to 11.7 million tons. However, the average gross profit per ton significantly dropped from RMB 42 in the same period last year to RMB 26, reflecting the company's competitive strategy of sacrificing profit margins for sales volume; other businesses are facing similar challenges. The industry generally expects that profit margins will gradually recover in the remaining time of this year, as subsequent production regulations will take effect and the strategy will shift from sales to profit, and the bank believes that CR BLDG MAT TEC's pace will be similar
According to the Zhitong Finance APP, Bank of America Securities has released a research report stating that considering the losses in the first quarter, it has lowered the earnings forecasts for CR BLDG MAT TEC (01313) for 2026 and 2027 by 32% and 27% respectively, and reduced the target price from HKD 1.3 to HKD 1.2, maintaining a "underperform" rating due to valuation premium and a lack of short-term catalysts.
In the first quarter of this year, CR BLDG MAT TEC reported a net loss of RMB 188 million, with a loss per share of RMB 0.027, in line with the forecast of RMB 170 million to 200 million. Despite a 7.1% contraction in national demand, cement and clinker sales during the period still increased by 3.6% year-on-year to 11.7 million tons. However, the average gross profit per ton significantly dropped from RMB 42 in the same period last year to RMB 26, reflecting the company's competitive strategy of sacrificing profit margins for sales; other businesses are facing similar challenges. The industry generally expects profit margins to gradually recover quarter by quarter for the remainder of this year, as production regulation will take effect, and the strategy will shift from sales to profit. The bank believes that CR BLDG MAT TEC's pace will also be similar