HK Stock Market Move | KB LAMINATES (01888) fell more than 5%, China Jushi Co., Ltd announced expansion, and the short-term cyclical decline in the market may have a negative impact on the company.

KB LAMINATES (01888) fell more than 5%, dropping 4.87% to HK$43.02 as of press time, with a turnover of HK$3.8 billion. On the news front, on the evening of May 13, China Jushi Co., Ltd (600176.SH) announced that in order to further enhance profitability and international competitiveness, and promote high-quality development of the fiberglass business, its wholly-owned subsidiary, Jushi Group Huai'an Co., Ltd, plans to start a project to build a production line for 50,000 tons of electronic yarn and 320 million meters of electronic fabric, with a total planned investment of 4.431 billion yuan. Citigroup believes that the news of the expansion of China Jushi Co., Ltd may have a negative impact on the short-term market sentiment of KB LAMINATES, as its stock price has surged 256% this year. However, the bank believes that if the stock price experiences a correction, it will be a good buying opportunity, as the bottleneck in the electronic fiber industry is still limited by the slow growth in the number of looms. Citigroup predicts that KB LAMINATES' monthly production capacity of electronic fabric will also increase by about 14% to 65 million meters by the end of 2026. Considering the constraints on loom supply, the bank expects limited industry supply growth in the next two years.