Building materials sector pullback, construction materials ETF Guotai (159745) down over 3%, cement industry supply-demand pattern expected to continue improving, pullback may present a layout opportunity.

Industrial Securities points out that by 2025, the supply and demand imbalance in the cement industry will ease. With real estate still recovering and infrastructure growth limited, cement demand remains under pressure; however, as industry awareness of “counteracting internal competition” strengthens, supply constraints marginally increase, and cement prices gradually stabilize, leading to some industry profit recovery. The cement industry’s PB valuation percentile has reached a historical low, and the bottom signals from off-season price increases are evident. Overall, benefiting from declining production costs and slight price rebounds, the cement sector’s net profit attributable to parent companies has turned profitable. Moving forward, stricter implementation of staggered production and further industry collaboration are expected to continue improving the supply-demand balance, supporting ongoing profit recovery.

Guotai (159745), a building materials ETF, tracks the Building Materials Index (931009), which mainly reflects the market performance of the building materials industry. Its constituent stocks cover traditional building materials such as cement, glass, and ceramics, as well as various new building materials. The index focuses on selecting representative companies within the industry to reflect the overall market performance of listed building materials companies, with strong industry representativeness and market influence.

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