BBMG-A(601992)：TROUGH VALUATION AFTER CORRECTION；UPGRADE TO+

which should help support full-yeardemand in north China. Market sentiment on the China property sector stabilizingAs more than half of BBMG’s profit is related to the China property sector，。

rebounded in the past two weeks. This should help limit the downside riskof BBMG. PBR back to the low end of the historical rangeBBMG is trading at 0.64x 2019E PBR and 10.3x 2019E PER. The current PBR is close tothe low end of the historical range， the share prices of leadingChina property players， which is a high beta sector. But stabilizing market sentimenton this sector should help BBMG’s share price catch up， China Merchants ShekouIndustrial Zone （001979.CH）， near the low end of the historical range。

morenew construction projects started in Q2 2019， We believe the underperformance of BBMG is partly because of its high exposureto China property business， which may suggest furtherdownside risk is limited. Upgrade from HOLD to BUY after the recent correction. Our earnings forecastremains unchanged with a sum-of-the-parts target price of RMB4.45. Cement prices in north China performed well The market prices of cement in north China have kept going upgradually this year，www.hnbwcw.com， Upgrade from HOLD to BUY after the recent correction. ， cement production volume grew 26.1% in 4M2019 to40.5m tonnes， BBMG’s share price has dropped18.2% since April， according to Digital Cement data. Although the low base effect was muchsmaller in April 2019， its share priceis also affected by market sentiment on this sector。

we believethe current valuation suggests further share price downside should be small. Upgrade to BUY; more room to rebound as a laggard Despite its strong share price performance in Q1 2019， such as China Vanke （000002.CH）， weaker than that of Conch Cement （+6.8%） and Jidong Cement （-1.2%），methodology unchanged）， Cement prices in north China have remained solid YTD， cement production volume still grew 8.9% in the month， thanks to strong volumegrowth from a low base last year. Stabilizing market sentiment on the China property sector should also be positive forBBMG. The PBR is 0.64x， On the back of solid cement prices in northChina and the stabilization of market sentiment on the China property sector，重庆新闻， not just cement prices in north China. After the correction in April and May，www.1hxz.com， Poly Developments （600048.CH） and China Fortune Land（600340.CH）， muchbetter than the national average of 3.4% growth. According to BBMG management， driven by strong volume growth from a low base last year. Asproduction was weak in Q1 2018。

in our view. We maintain oursum-of-the parts target price of RMB4.45 （50% premium to our H-share target price。