On October 25, Tapai Group released a record of investor relations activities.
Q: Recently, we learned that from the end of September 2024, cement enterprises along the Yangtze River Delta plan to increase the price of clinker by 100 yuan/ton at one time; The Pearl River Delta will carry out a round of price increase in mid-October, and Fujian will also raise the price recently. Please introduce the recent trend of cement prices in the two core markets of the company, the Pearl River Delta and the eastern Guangdong market?
Answer: We are also concerned about the recent rise in cement prices in East China. The fourth quarter is the traditional peak season for sales in the south. Recently, the Pearl River Delta market has also carried out a round of push up in cement prices. The main reason is that the good climate is conducive to construction; Second, at present, the Xijiang River has entered the dry season, the quantity of Guangxi cement transported to Guangdong through the Xijiang River has declined, and the contradiction between supply and demand of cement in the Pearl River Delta has improved, which is conducive to the price increase of cement in the Pearl River Delta.
According to the past data, the price elasticity of cement in the fourth quarter of each year in the Pearl River Delta region is relatively large, and the profit contribution is relatively high. It is expected that there will still be room for price increase in the Pearl River Delta in the later period. Since
October, the price of cement in East Guangdong market has been relatively stable and has not risen yet. At present, the 4600t/d production line of the local cement industry has been ignited recently, which is expected to have a certain impact on the East Guangdong market in the short term. However, the increase in cement prices in the Pearl River Delta and Fujian can lay a certain foundation for the increase in cement prices in the eastern Guangdong market.
In the near future, the central government will continue to stabilize real estate and support local government debt conversion, which is expected to boost real estate and infrastructure, and will form a certain support for cement demand. Next, the company will seize the opportunity of the peak sales season, pay close attention to the recovery of demand and market competition, and flexibly adjust its sales strategy to cope with market changes. The company will strive to maximize the interests of enterprises on the basis of consolidating market share.
Ask: Would you please introduce the daily cement shipment volume of the company since October? What is the demand for next year?
Answer: Entering the traditional sales peak season in the south, it is also the construction peak season. The good weather is conducive to the construction of the project. The company's shipment volume began to increase in September, continued to increase in October, and also improved year-on-year.
In the near future, the central government will continue to stabilize real estate, special debt can be used for land reserve and acquisition of commercial housing in stock, support local government debt, etc., which is expected to boost real estate and infrastructure, support cement demand, and it is expected that cement demand will continue to decline next year. However, it is estimated that the decline will be narrowed.
Q: In the first three quarters, the Company achieved a cement sales volume of 10.6106 million tons, representing a decrease of 14.89% as compared with the same period of last year, and the decrease was narrower than that in the first half of the year, but the decrease may still be greater than decrease in cement consumption in the industry or in Guangdong. What are the main reasons?
Answer: First, 75% of the company's production capacity is concentrated in the eastern Guangdong market. The economy in eastern Guangdong is relatively underdeveloped. The downward trend of real estate development investment is greater than average level of the whole province. At the same time, the growth rate of infrastructure investment is less than average level of the whole province, thus dragging down the demand for cement in eastern Guangdong. The demand for cement in eastern Guangdong has declined even more, resulting in a corresponding decline in the company's sales ;
Second, in the second quarter of this year, there was continuous rainfall in South China, especially on June 16, when the Grotto River in Jiaoling County, where the company's headquarters is located, suffered a once-in-a-century flood disaster. The "6.16" flood led to the interruption of some national highways and expressways in Jiaoling County, affecting the cement shipment of the company's Meizhou base. It also has a negative impact on the company's cement sales.
