UBS believes stronger-than-expected cement output in China (+30% on-year) indicates a solid demand recovery in March, which is also in line with the house’s recent observation that both infrastructure and real estate investment in tier 2-4 cities remain robust.

"Some investors are concerned that the cement price could be capped by the government. However, we don’t think it’s likely to happen as cement price increases have a very limited impact on CPI and PPI."

The house remains positive on the China cement sector.
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