Shares of CR BLDG MAT TEC (01313) plummeted 5.06% in early trading on Monday, following a research report from China International Capital Corporation (CICC) that significantly lowered earnings per share (EPS) estimates for the company. The sharp decline comes as investors react to CICC's downward revision of 2025 and 2026 EPS forecasts by 66% and 48%, respectively, citing fixed asset impairments and potential underperformance in cement volume and pricing.

According to CICC's report, CR BLDG MAT TEC recorded over HKD 100 million in fixed asset impairments as management expenses for the first half of 2025, a charge not present in the previous year. This, combined with concerns about cement demand and pricing, has led CICC to adjust its EPS projections to HKD 0.06 for 2025 and HKD 0.11 for 2026. Despite these revisions, CICC maintains an outperform industry rating for the company, albeit with a 12% reduction in the target price to HKD 2.2.

The company's recently released 3Q25 results align with CICC's expectations, showing an 11% year-on-year decrease in revenue to HKD 4.86 billion and an 83% drop in net profit attributable to shareholders to HKD 24.32 million. The cement sector continues to face challenges, with weak seasonal demand and increased supply-demand imbalances. However, CR BLDG MAT TEC reported strong growth in its aggregates and concrete sales, with volumes increasing by 32% and 11% year-on-year, respectively. Looking ahead, CICC anticipates potential price increases in late 2025 and improved per-ton profitability in the South China market, contingent on strict implementation of measures to limit overproduction and the company's focus on profit and pricing strategies.