Anhui Conch Cement Co - July 2014

Shares in Anhui Conch rose by over five per cent earlier this month following the company’s forecast of a 90 per cent YoY increase in first-half net profit to CNY3.06bn (US$492.75m), compared to the same period last year. The expansion is being attributed to increased product sales and prices, and lower coal costs.  However, according to a recent report by Barclays, there is ongoing seasonal weakness in cement prices, which is expected to persist throughout 3Q14 due to “muted cement demand”.

At the end of last month, Credit Suisse Group AG sold 805,174 shares in Anhui Conch worth HKD21.95m (US$2.8m). Following the sale, the Swiss finance institution still holds 103.1m shares representing a 7.93 per cent stake in the cement producer.

Meanwhile, Anhui Conch has come out on top of a list of China’s cement companies in terms of comprehensive strength. The list, compiled by the China Cement Association, ranked the companies based on sales of cement (50 per cent), total pretax profit (20 per cent), total company assets (10 per cent) and market value (20 per cent). Anhui Conch took the top spot with a rating of 239.97, followed by China National Building Materials (CNBM) with 219.19.