Huai Long Securities: The "price recovery mode" of fiberglass has started, and the profitability of the building materials industry is expected to continue to improve.

Huaxia Dragon Securities released a research report stating that in the third quarter, the continuous introduction of real estate policies is expected to drive the valuation restoration and fundamental improvement of the building materials industry. In terms of specific segments, in September, the weather continued to improve, the cement market entered the traditional peak season, but the recovery in demand is still insufficient, with a significant year-on-year decline in monthly cement production, but a slight increase on a month-on-month basis. In the glass industry, according to Longzhong Information, the next period is expected to see a fluctuating trend in the float glass market following the price increase, with some year-end rush demand in the downstream sector, but not strong. In the fiberglass industry, following Shandong Fiberglass Group Corp.'s launch of industry price increase, and the CHINA GLASS Fiber Industry Association taking action to respond and prevent price wars, the industry price increase is expected to enhance industry profitability. Huaxia Dragon Securities main points are as follows: Building materials industry: In the third quarter, central ministries further improved top-level design of market stabilization policies, with local housing purchase restrictions being relaxed, and optimization of housing provident fund implementation, and continued strong efforts in real estate policies. With the gradual implementation of activating existing land plans, the promotion of affordable housing and high-quality housing construction, industry inventory pressure is expected to gradually ease. The continued introduction of real estate policies is expected to drive the restoration of industry valuation and improvement of fundamentals, maintaining a "recommended" rating for the building materials industry. Cement industry: In September, the weather continued to improve, the cement market entered the traditional peak season, but the recovery in demand is still insufficient, with a significant year-on-year decline in monthly cement production, but a slight increase on a month-on-month basis. The main reasons for the weak demand recovery in September include: investment decline, shortage of project funding which has not been substantively alleviated, leading to delays in construction progress; in addition, frequent rainfall in many areas and disturbances caused by typhoons have temporarily disrupted construction progress. According to the monitoring by Digital Cement Network of the actual market demand indicator, the cement shipment rate in September increased slightly compared to the previous month, but decreased by nearly 4 percentage points year-on-year. In the first three quarters, the national average cement shipment rate has slightly decreased year-on-year, indicating a continuous shrinking demand. According to the data from Digital Cement Network, in September 2025, the national average price of cement was 346.77 yuan/ton, an increase of 5.43 yuan/ton from June. Cement demand continues to operate weakly, focusing on positive changes in the industry supply side, with individual stocks focusing on cement industry leaders such as Gansu Shangfeng Cement(000672.SZ), Huaxin Cement(600801.SH), Anhui Conch Cement(600585.SH). Glass industry: According to Longzhong Information, the next period is expected to see a fluctuating trend in the float glass market following the price increase, with some year-end rush demand in the downstream sector, but not strong, with supply pressure still existing, and a high probability of narrow price swings. Looking at the supply side, there may be shutdowns and cold repairs in the next period, but both have strong uncertainties, with daily production expected to remain above 160,000 tons. On the demand side, some projects that are near completion provide some support for demand, but processing companies will mainly purchase for immediate needs due to limited funds and payment situations. In addition, some regions have high midstream inventory, which will also bring certain pressure to the market. In terms of individual stocks, focus on industry leader Zhuzhou Kibing Group(601636.SH), Shandong Jinjing Science & Technology Stock(600586.SH). Glass fiber: On September 5th, Shandong Fiberglass Group Corp. issued a "Price Increase Notice," announcing that effective immediately, the sales prices of some fiberglass products will be adjusted, with specific increases ranging from 5% to 10% per ton for products such as direct yarn, light board special yarn, and short-cut mat special yarn, marking the start of a industry price increase. Coincidentally, CHINA GLASS Fiber Industry Association also released the "Initiative on Establishing and Maintaining a Fair and Orderly Competitive Environment in the Glass Fiber and Products Industry to Resist 'Internal Competition'" on the same day, with participating units including major companies in the fiberglass industry such as Jushi Group, Taishan Fiberglass, Chongqing Polycomp International Corporation, Shandong Fiberglass Group Corp., Jiangsu Changhai Composite Materials, Jizhong New Materials, Sichuan Weibo, Chongqing Sanlei, Tianhao Fiberglass. The industry price increase is expected to improve industry profitability, with individual stock focus on industry leaders such as China Jushi Co., Ltd (600176.SH), Sinoma Science & Technology (002080.SZ), Grace Fabric Technology (603256.SH). Consumer building materials: The continuous introduction of real estate policies is expected to drive industry valuation restoration and fundamental improvement, recommended focus on: Zhejiang Weixing New Building Materials (002372.SZ), Beijing New Building Materials Public (000786.SZ), SKSHU Paint (603737.SH), Beijing Oriental Yuhong Waterproof Technology (002271.SZ), Guangdong KinLong Hardware Products (002791.SZ). Risk Warning: Unfavorable changes in the macro environment; errors in data from quoted sources; construction progress of infrastructure projects falling short of expectations; market demand falling short of expectations; focus on company performance falling short of expectations; real estate loosening policies falling short of expectations.