Citigroup: Lowers target price of Chinese building materials to 4.2 Hong Kong dollars, "Buy" rating.

Citi released a research report indicating that after China Building Materials announced its first quarter performance and management provided the latest guidance, they updated their valuation model. The bank introduced forecasts for 2027 and raised profit forecasts for this year and next year by 8% and 10% respectively, to reflect adjustments in cement and clinker unit gross profit forecasts. The bank reduced China Building Materials' target price from HK$5.4 to HK$4.2, equivalent to a forecasted P/E ratio of 7.8 times for this year, equivalent to the average of H-share peers, to reflect the current industry and market environment, with a rating of "buy." Due to more disciplined supply and a decline in coal costs, profit margins are expected to expand this year, partially offsetting the downward revision in sales volume forecasts.