Guotai Haitong: Overseas fundamentals remain strong; maintain "Overweight" rating on WESTCHINACEMENT (02233)

Guotai Haitong issued a research report maintaining an "Overweight" rating on WESTCHINACEMENT (02233), forecasting the company's net profit attributable to parent for 2026-2028 at RMB 936 million / 1,605 million / 2,073 million, with EPS of RMB 0.17 / 0.29 / 0.38, respectively. Given that the company is a standout in overseas expansion with strong growth potential, and referencing comparable companies, the bank deems it appropriate to assign the company a 2026 PE of 13x, implying a fair price of HKD 2.54 (RMB to HKD = 0.87:1), and a 2026 PB valuation of 1.3x, implying a fair price of HKD 3.63. Out of prudence, a target price of HKD 2.54 is selected. Guotai Haitong's main views are as follows: Uganda cement prices remain firm; watch for exchange rate fluctuations According to the bank's tracking data, the PPI for Manufacture of cement, lime and plaster published by the Uganda Bureau of Statistics remains at a high level and has held firm even after dollarization. Recently, the Ugandan shilling has depreciated rapidly against the US dollar, which warrants further attention. Ethiopia cement prices recovering Since the shock of the currency reform, Ethiopia's exchange rate has remained stable over the past year, providing favorable conditions for corporate profitability. Ethiopian cement prices have maintained an upward trend this year, with the national cement market price at approximately USD 117/ton in March, approximately USD 127/ton in June, and approximately USD 150/ton in September. Strong demand in Central Asia Uzbekistan's cement output surged 31.2% year-on-year in 2025, and on this high base, cement output still grew 6% in January-August this year, indicating robust demand. The bank judges that cement prices in Uzbekistan are expected to rise steadily. Risk warnings Exchange rate risk, foreign exchange control risk, cost escalation risk.