Glass prices rose slightly and the proportion of production cuts remained high

Glass price: There is a slight increase. From the price indicators we monitor, the price of building-level glass city prices rose. The auto-grade price was up 5 yuan/weight box apart from Guangzhou CSG, and the rest remained unchanged. The price of LOW-E glass was not change.

According to industry website information, in the current period, South China and Central China's production companies increased their prices slightly, and North China glass manufacturers did not increase their prices, but in East China, due to the high inventory of production companies, they only increased symbolically by 1 yuan. The future trend depends on demand.

Capacity and inventory: The production cut-off ratio is close to 30%. Destocking is still underway. Since the fourth quarter of 2011, there has been almost no ignition capacity, and the production capacity has been continuously increased. Currently, the production capacity of suspension production accounts for 29.58% of the total production capacity (the worst in 08-09. In the meantime, the production stopped production accounted for 34.13%.) The manufacturers have been in the destocking phase since November 2011, and the inventory is still 72% year-on-year.

Maintaining a “hold” rating for the industry The short-term glass prices have risen. We believe that this is mainly due to the fact that manufacturers are rushing prices before the peak season. This is an annual practice; current industry profitability is at a low point, and there is less possibility of further deterioration in the future; glass Industry demand is more unitary than cement (more than 60% in real estate, more than 20% in automobiles, and more than 10% in exports). At this moment, it is still necessary to wait for the release of the downside risk of real estate investment. In Q2, there may be a relatively good time for intervention; CSG A (000012), Qibin Group (601636) and AVIC Sanxin (002163).

risk warning:

The macroeconomic downturn, real estate investment growth rate decline.