26, Conch Cement made a remarkable announcement: the company intends to use its own funds to repurchase a shares by 600 million to 1 billion yuan (the price ceiling is 27.71 yuan/share), and simultaneously repurchase H shares by no more than 700 million Hong Kong dollars, totaling about 1.7 billion yuan. All repurchased shares are cancelled, not used for incentives, not for sale-directly reducing registered capital.
This is not an ordinary capital operation. The whole cement industry is falling into a deep downward cycle of overcapacity and double killing of volume and price: in 2025, the national cement output will be 1.693 billion tons, with a year-on-year decrease of 6.9%, a new low since 2010; the utilization rate of clinker capacity will drop to about 48%, and more than half of the capacity will be exposed to the sun; The total profit of the whole industry is about 29 billion yuan, which is more than 80% smaller than historical peak. In this context, the number one player is taking out real money to bet on his own stock, which is worth taking apart.
Repurchase for what?
Conch Cement gave four reasons in the announcement: to safeguard the value of the company, to safeguard the rights and interests of shareholders, to enhance investor confidence, and to recognize the value of the company's stock. To put it bluntly, these four words have the same meaning: we think the stock is undervalued, so we come out to buy it.
This signal is more expensive than 1.7 billion yuan itself.
From the valuation dimension, the current conch cement market-to-net ratio has been hovering at a historic low for a long time, with PB less than 0.7 times, which is rare for a leading enterprise with sustained profitability and huge cash reserves. Repurchase and cancellation directly reduce the total share capital, which not only increases the net assets per share, but also conveys the management's judgment on the intrinsic value of the company- "the current share price is lower than its real value". The
timing is equally intriguing. Conch Cement a shares had only been repurchased from the end of 2023 to the beginning of 2024, with a total of 22.24 million shares repurchased at a cost of about 501 million yuan. It was initially planned to be sold in accordance with the regulations, and then in March 2026, the board of directors decided to cancel the capital reduction and submit it it to the shareholders'meeting for consideration. The repurchase plan was cancelled at the beginning. Two repurchases and two cancellations are a systematic logic of shareholder returns, not an impulsive emotional operation. Why is
the dragon head making a move at this moment? The
deeper question is: Why now? The structural dilemma of the
cement industry has not been lifted. On the demand side, real estate investment continues to adjust in depth, the growth rate of infrastructure investment slows down, and there is no obvious trigger point for the reversal of downstream demand in the short term. On the supply side, the withdrawal of backward production capacity is still the rhythm of "boiling frogs in warm water", and the situation of serious mismatch between supply and demand is difficult to change fundamentally in the short term.
In this context, Conch chose to buy back in a big way at this moment, reflecting a kind of "long-term doctrine": the short-term industry downturn is a cycle, the company's fundamentals have not deteriorated; the pessimistic expectations of the market have created a valuation depression, which is the window period of repurchase.
At the same time, this is also a subtle industry signal. As the head of the dragon, every movement of the conch has a demonstration effect. The combination of supporting the market, cancellation and strengthening the promise of return conveys an attitude to the whole industry: the winter is not as long as we imagined, at least we intend to hold on, and we intend to let shareholders hold on together.
Of course, it is also necessary to clarify the other side: no matter how much repurchase, it will not change the fundamentals of supply and demand in the industry. If the capacity utilization rate remains at a low level of 48%, if there is no clear turning point signal on the demand side, even if the stock price is repurchased for a while, it will take time to repair the fundamentals. The highest 1.7 billion yuan can support the stock price, but not necessarily the whole cycle.
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