129823520529375000_24Tower Group: bullish on the company's long-term performance
Investments we recently visited a company secret Tung on the company's future development strategy and operating conditions for exchanges in the near future, main content are as follows: downstream demand remained weak, still greater pressure both to inventory infrastructure areas also are real estate, project starts is not at all obvious. 1 quarter of the year, the company sold about 2.1 million tons
Rift CD-key, down from 2.3 million tonnes in the same period last year;Sales in April is still only 900,000 tons, shipments are still not good enough. As of 1 of its quarterly bulletin, the company's stock reached 640 million
TERA Gold, slightly increase 20 million per cent at the end of last year; inventories high background, company 1-quarter capacity utilization rate significantly lower than the same period in previous years, yields only 1.85 million tons of clinker (2.33 million tons over the same period last year, source: China building materials total information network). CompanyProgram realization of cement production and sales of 11 million tons this year, if the subsequent recovery in demand is lower than expected sales target may not be able to complete. Company sold about 120,000 1 ~ April concrete (and tables), according to the current situation, completing 600,000 target for the whole year difficult; concrete business profitability are to a large extent related to capacity utilisation level,Low capacity utilization which may lead to achieve the goal of turning losses into profits for the whole year is more difficult to achieve. Guangdong regional progress of backward production capacity out backward cement production capacity of slightly less than expected in East Guangdong region larger (about 7.008 billion tons), and concentrated in Meizhou district. 2011 in Meizhou is about to complete the backward cement production capacity 1.4 million tonnes eliminated. Backwardness of this two years in MeizhouCapacity eliminated mainly Tower, oil pits two enterprises, and other smaller enterprises. For small businesses that are not new on line, placement of workers, local tax problem backward production capacity out of the two major resistance. Future maximum aspect is still backward production capacity out of the market space. Posted 2 10000T/D clinker production line of the company's early work is steadyStep forward, when the national development and Reform Commission completed approval release is still a strong uncertainty. High control forces of the company in Eastern Guangdong area and cost advantages that can, to a certain extent reduce the profit decline in company of Guangdong regional cement market share reached 45%, and higher costs in the region of backward production capacity ratio. High market share and cost benefits to companies in the region of stabilityHigh gross profit margin, price competitive pressures lower than the Pearl River Delta region. Companies in the Pearl River Delta region (Huizhou gantry base) very strong gross margins of fluctuation, and gross margins around the Central narrow fluctuations 30% of the Guangdong region. About two-thirds capacity is concentrated in East Guangdong region, will, to a certain extent reduce the company's overall profit decline, this is the company in the current environmentA big advantage of other cement stocks. Investment recommendations and ratings listed private company is the only cement company, and somewhat conservative depreciation policy (depreciation rate is higher than the other listed cement company), we are optimistic about the company's long-term performance. Expected to 2012-2014 EPS $ 0.49, 0.62, respectively, corresponding to PE-20.2, 16.1, times. Macro has been gradually transition to a recession, the recovery period in the late, cement shares risks have been gradually released
TERA CD-key, we increase the company to "overweight" rating. Risk prompt recovery in demand than expected.
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