The recent rebound in China cement stocks is "largely policy driven," says UBS. Looking forward, the policy could remain positive for the sector but some property restocking concerns still remain.
"We believe 4Q11 could see cement stocks rising further with the policy support, but a correction could also follow when property-related data deteriorate."
The house keeps its positive sector view from a 12-month perspective but also highlights the risk of stock corrections due to property investment deceleration.
"We suggest investors look for attractive investment opportunities should share prices weaken;" its top picks are Anhui Conch Cement and Shanshui Cement.