The government's debt relief policies are intensifying, leading to profit recovery in the building materials sector. The Guotai Building Materials ETF (159745) has experienced net inflows of over 160 million yuan for five consecutive days.

Government debt-relief policies are being further strengthened. In the building materials sector, earnings are set to recover. Judging from liquidity conditions, the Cathay Building Materials ETF (159745) has seen net inflows exceeding RMB 160 million for five consecutive trading days.

Guosheng Securities noted that with the government’s debt-relief policy being further intensified, municipal engineering projects are expected to be accelerated. Work related to municipal pipe networks and tangible anti-seismic and isolation measures could also be rolled out faster. Cold repairs for float glass are speeding up; photovoltaic glass companies are reducing production, and the supply-demand contradictions are expected to ease. Consumer building materials benefit from renovations of second-hand homes and existing housing. In the cement industry, demand is still in the process of searching for a bottom; companies’ efforts to pause production at staggered times are strengthening, and prices are fluctuating around the breakeven point of profits and losses. Demand for fiberglass remains firm, and wind power installed capacity could come in better than expected.

The Cathay Building Materials ETF (159745) tracks the Building Materials Index (931009). The index mainly covers publicly listed company securities in building materials-related areas such as cement, glass, and ceramics, to reflect the overall market performance and development trends of the building materials industry.

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The Economic Daily News

(Editor: Dong Pingping)

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