Deutsche Bank sees modest China earnings recovery in 2013

Deutsche Bank has turned more positive on China's average selling pricing recovery in the next 12 months. For 2013, it expects a revival of property starts and captive supply to further support production halts and thus more stable prices.

"While we are more cautious in the medium term due to structural overcapacity and declining cement intensity, we see modest earnings recovery in 2013."

Deutsche Bank's top picks are China Resources Cement where it sees a healthy turnaround in supply/demand for South China, and China National Building Materials which should be the main beneficiary of successful production halts amid a demand recovery.