Historists call cement the most important material in a civilized society. Microsoft founder Bill Gates (Bill Gates) has a set of data in a blog that in the 100 years of the 20th century, the consumption of cement in the United States increased to 4.4 billion tons.
In comparison, China consumed about 6.4 billion tons of cement in just three years from 2011 to 2013. This is similar to the statistics of . The U.S. Geological Survey : China's cement consumption between 2010 and 2012 was about 140% of the total U.S. from 1900 to 1999.
3 cement usage exceeds the US 100 years of use. The huge cement demand in the Chinese market not only shocked Bill Gates, but also caused the pursuit of many giants.
From April 27 to 29, 1993, the first " Wang Gu Talks " was officially held in Singapore. This meeting with special significance to both sides of the Taiwan Strait is eye-catching.
As one of the protagonists, Gu Zhenfu is eye-catching, but what is even more interesting is Gu Zhenfu's other identity.
In the 1960s, Gu Zhenfu pushed enterprises from the industry to the financial industry. In April 1966, he established China Securities Investment Company, which was officially reorganized into "China Trust and Investment Company" in 1971. Gu Zhenfu became the chairman, which was the first trust company in Taiwan. At this point, the Gu family has become one of the five major family groups in Taiwan.
But it is hard to imagine that Gu Zhenfu would deal with cement.
In 1973, Gu Zhenfu became the chairman of Taiwan Cement Company. Later, he founded the Taiwan Cement Group Enterprise and became one of the major Taiwan group enterprises, accounting for more than one-third of Taiwan's cement production and was called the "cement giant".
Gu Zhenfu admires Zhuge Liang the most and likes to sing "Borrow the East Wind". His name as "Peking Opera Expert" has long been spread all over the country. In October 1998, during the second "Wang-Guo talks", the Association for the National Taiwan Straits specially hosted Gu Zhenfu and his wife in the theater. After singing some famous Peking Opera actors, Gu Zhenfu also took the stage to sing three sections with great enthusiasm. The famous Peking Opera performing artist Yuan Shihai commented: "He sang very well and had a very erotic charm."
Under his feather fan, Taiwan Cement Co., Ltd. can be said to be a microcosm of the development of Taiwan's cement industry. He has experienced the entire development process of Taiwan's cement industry from scratch.
Taiwan's cement industry has had an annual output of up to 28 million tons in the years of rapid development in the 1990s, with 12 companies. Today, Taiwan's economic growth has entered a mature stage, and cement sales have dropped to about 60% of its peak. The two companies alone account for 75% of the market share: Taiwan cement accounts for 50% and Asian cement accounts for 25%.
But in 2003, when the second son Gu Chengyun officially took over Taiwan cement, Taiwan was already facing the depletion of limestone ore, shrinking local cement market, and dumping of cement in Southeast Asia. Founded in 1946, Taiwan Cement ranks among the top ten in Taiwan's manufacturing industry, accounting for half of Taiwan's market and has never made any losses.
Since 2003, many cement manufacturers in Taiwan have turned to the opportunity to invest in and build factories in the mainland.
Taiwan Jiaxin Cement Company's brother Zhang Anping, is the third son-in-law of Gu Zhenfu, chairman of Taiwan Cement Company. However, Jia Ni is still subject to the island's control with and sub-cid, and is not allowed to go outside the island to seek development early. In fact, Jiani is one of the earliest cement companies to invest in the mainland.
In December 1995, Jiani invested US$280 million in Qiaotou Town, Jurong City, Jiangsu Province to establish the Jingyang Cement Plant, and built a cement clinker production line with a daily output of 5,000 tons in 1997. By 2001, the cement of Jingyang Cement Plant had reached 2.56 million tons, making a profit of 80 million yuan.
If cement is added to Shanghai Jiaxinganghui and Jingyang Shenzhen Branch, the total sales of Jiaxin Mainland (related, market) cement reached 3.86 million tons last year, ranking the highest sales of Taiwanese cement companies in the mainland.Jiani said that it is expected that Jingyang Cement's production will continue to increase significantly in 2002. The company's total cement sales in mainland China are expected to reach 4.765 million tons, and Jingyang Cement Plant can make a profit of more than RMB 100 million.
In 2018, Tainini Group's revenue was 124.5 billion yuan, an annual increase of 26.74%; Yanini's revenue was 83.938 billion yuan, an annual growth of 29.34%.
Relying on the support of the mainland market, the two Taiwanese cement companies hit a new high in the whole year of 2018.
In the mainland, there are currently 3,000 cement companies, providing more than 2 billion tons of cement each year, accounting for about half of the global market supply. The cement market has long been a leader.
After the reform and opening up, China's cement industry has been listed as a key technical transformation support industry by the state. It plans to increase the advanced pre-decomposition kiln cement production capacity to 60 million tons, and about 30 billion yuan of construction funds are required. The funding gap is large, and the state can only provide interest subsidies for some technical transformation projects.
Therefore, the state encourages cement industry enterprises to raise funds from the capital market and has proposed the goal of raising 3 billion yuan in development funds in the capital market.
In fact, international cement companies have long been coveting China's vast market. The cement industry belongs to the traditional building materials industry, and has the characteristics of high production energy consumption, large resource consumption, serious environmental pollution, and small transportation radius. Since the 1980s, developed foreign countries have begun to compress the domestic cement industry and transfer it to developing countries.
While the world's cement industry is in low growth, China's cement industry has grown rapidly. Statistics show that the world's cement production increased by only 3.4% per year from 1990 to 1998, while China's cement production increased by 12.7% per year from 1990 to 1998.
In terms of industry concentration , continuous alliances and mergers and acquisitions are the secrets of success for foreign cement companies to integrate the cement industry. This was particularly prominent in the 1990s. Many world-renowned cement companies have disappeared and integrated into other companies. By the end of 2000, the production capacity of the world's top ten cement groups had reached 530 million tons, accounting for 1/3 of the world's cement production capacity at that time.
The first to invest in the cement industry in China was our closest neighbor of Japan. As early as 1989, Japan's Onoda Cement Company established a joint venture Huaneng-Onoda Cement Company in Dalian, and completed and put into production in 1992. It has 500 employees and has an annual cement production capacity of 1.5 million tons/year, with an average annual cement production of 1.27 million tons.
On October 1, 1998, Chichibu Onoda and Japan Cement merged into Pacific Company. After the merger, the cement production capacity reached 43 million tons, and the output accounted for about 39% of the Japanese market, making it the largest cement company in Japan.
It can be said that Japan's investment in China's cement industry is ahead of the world. However, due to Japan's closed economic environment, Pacific Company and its predecessor cement are mainly targeted for Japan's product sales, and their joint ventures are mainly built in China and South Korea. Due to Japan's economic downturn in recent years, Pacific's investment in China's cement industry has gradually lagged behind cement companies in other countries and regions.
In January 2001, French Lafarge Group announced the acquisition of the UK's sixth largest cement company, BlueCircle. After the merger and acquisition, Lafarge's production capacity increased by nearly 55 million tons/year. At that time, the company's production capacity was close to 150 million tons/year, of which the production capacity in Asia was estimated to exceed 22.6 million tons/year, becoming the new overlord of the world's cement industry.
Lafarge is a latecomer in the cement industry in China. Since entering China, its cement business has developed rapidly.
In November 2005, Lafarge and Hong Kong Ryan announced the merger of the cement business of the two parties in China and jointly established Lafarge Ryan Cement. In November of the same year, Lafarge acquired 266.5% of the shares of Sichuan Shuangma and became the actual controller of Sichuan Shuangma.
However, unlike Lafarge, the cement giant Haorui's operating method in China is to invest and invest.In 2005, Haorui became the largest shareholder of Huaxin Cement with a shareholding ratio of 26.1%.
So far, both cement giants have begun to develop rapidly by investing in Chinese listed companies. According to media reports, the total profit of the national cement industry at that time was not as good as that of a Swiss cement company; at the peak, Lafarge's market share in the southwest once reached 20%, becoming the veritable "King of the Southwest".
However, in the next ten years, China's cement industry had a serious overcapacity, and Lafarge also fell into losses. In April 2014, Lafarge and Howri jointly issued an announcement stating that the largest group in the building materials industry, Lafarge
. The reason why Lafarge and Howri merged was because the world economy continued to be sluggish and the cement industry was overcapacity. The merger could allow Lafarge and Howri to divest some of its assets in Europe and North America, thereby converting it into potential assets in emerging markets; secondly, the merger of the two major industry giants may form an oligopoly, which will greatly enhance the bargaining and pricing power of the group company.
But in fact, the most fundamental reason for the merger of Lafarge and Hauri is that the two companies are facing development dilemma. Due to the sluggish market demand and high debt, the company's profits no longer grow and are in a state of stagnation.
The failure of foreign-funded enterprises has given rise to the rise of Chinese cement enterprises.
China's cement industry has expanded significantly in the past decade.
Many Chinese cement manufacturers have received government support and can obtain cheap funds. Just like other industries such as electrolytic aluminum, steel and shipbuilding, China's cement industry is also in a state of serious overcapacity.
Since China Building Materials Group is listed on the Hong Kong Stock Exchange, Conch Cement has been the largest cement company with the largest market value in A-shares for a long time.
As the leader of A-share listed companies, the upward cycle since 2016 has successfully broken through the historical highest price during the 2007 bull market and rose to 49 yuan.
Obviously, the rise in price since 2016 has made Conch Cement have gained a lot, and the stock price has also risen. However, in comparison, although small and medium-sized enterprises in industries such as Jinyuan Co., Ltd. have increased to varying degrees of profit, their stock price performance is still a certain gap compared with Conch Cement.
data shows that Conch Cement's return on equity in the first three quarters of 2019 was as high as 12.26%. This data ranks second in the top ten non-recurring profits in the cement sector in the first three quarters, second only to Shangfeng Cement.
Considering the largest size of conch in the industry, this data is very eye-catching.
In 2019, the company's main focus was in the eastern and central regions. Financial report data shows that the company's sales volume has increased through market coordination in the eastern and central regions, while prices have increased significantly, with sales volumes rising by 44.70% and 32.52% year-on-year respectively.
In the profit ranking of cement companies in the first three quarters of 2019, Conch Cement dominated the market with a profit of more than 10 billion yuan, followed by Huaxin Cement. In July 2015, a global merger between HOLCIM and LAFARGE GROUP, two largest building materials companies in Europe was announced to be completed.
A year later, Huaxin Cement, whose actual controller is Haorui, acquired the former world cement giant Lafarge's business in China, including the original cement production capacity of the listed company Sichuan Shuangma.
Due to the strong regional nature of cement products, Huaxin Cement, which has a competitive advantage in the southwest region, can resist the competitive impact from China Building Materials and Conch Cement to a certain extent. After the integration, Huaxin Cement has more obvious advantages in the southwest region. After the consolidation of factories in Yunnan, Guizhou, Chongqing and other places, the production capacity of clinker and cement was about 10 million tons and 15 million tons respectively. The proportion of production capacity in the entire southwest region increased to 36%, jumping to the fourth largest cement manufacturer in China.
In addition, in Tibet, an important market market for infrastructure construction, Huaxin Cement also has a high market share. It currently occupies most of the market space with Tibet Tianlu. This is also a regional market with strong performance certainty.
After years of integration, China's cement industry has emerged: the more developed the market economy, the higher the price of cement.
The very important reason is that in the economically developed provinces represented by coastal areas, the marketization process of their building materials industry is more sufficient, the clearance of backward production capacity is more sufficient, and the market concentration of advantageous enterprises is relatively higher, so price changes are more sensitive.
According to statistics, Shangfeng Cement currently has an annual production capacity of cement clinker of cement clinker and about 9.5 million tons of cement. It only ranks 20th in the 2016 cement clinker capacity rankings calculated by China Cement Network, but its production capacity exceeds 90% is in Anhui, Zhejiang, Jiangsu and other regions with developed economy, more mature market economy, and higher concentration of cement industry.
In the first three quarters of 2019, Shangfeng Cement weighted net asset return rate was as high as 27.13%, ranking first among 10 cement companies on the list, and the company's clinker product gross profit margin was significantly higher than that of the industry leader Conch Cement.
China's cement market has long entered the Red Sea market, and cement companies represented by Conch Cement have led the era of oligarchy in the cement industry.
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