Fireproof glass window and other building materials industries continue to strengthen

Supply and demand determine prosperity

The prosperity of fireproof glass window profession is determined by the supply relationship. Under the expectation of a record high professional profit margin and tight regulation of fixed asset investment, the market is generally worried that the decline in demand will lead to a decline in professional prosperity. However, industry experts believe that now, the market still focuses on new production capacity, and there is no need to worry too much about demand.

First, the core driving force of the career boom cycle is the relationship between supply and demand. The quality of supply-demand relationship is the decisive factor of career cycle change, which is not disturbed by cost factors. In the case of preference of supply-demand relationship, the pressure of rising cost will be transferred through the rise of product price.

Secondly, in the foreseeable period, the development status of GDP growth driven by fixed asset investment in China is difficult to change. Therefore, China's demand for cement and glass will continue to grow at a high speed, and this trend will not change in the short term.

Finally, from the historical situation, the fluctuation of occupational demand for fireproof glass windows in China is significantly less than that of supply. Therefore, the correlation between occupational cycle and supply change is greater than that of demand change. When judging the career trend, the attention to the supply side should be greater than that to the demand side.

Capacity expansion is unlikely

The expansion speed of the professional production capacity of fireproof glass window depends on the increase of the investment of fireproof glass window, which is determined by two factors:

First, the actual profitability of the profession. Firstly, the prosperity of the whole profession directly affects the cash flow status of the enterprise. As a profession that needs to continuously make capital contributions to maintain the scale expansion of the enterprise, the cash flow status of the enterprise directly affects its new capital expenditure in the next year, and then affects the investment of production capacity; Secondly, the prosperity of the profession directly affects the willingness of non professional funds to enter the fire-proof glass window profession. From the end of 2003 to the beginning of 2004, the hot market of cement in China directly led to a large number of non professional funds entering the cement profession, and then caused the severe oversupply of cement profession since the second half of 2004.

Second, macro-control. First of all, the investment willingness of enterprises according to the professional prosperity will be restricted by the national macro-control. At present, the macro-control policy led by the national development and Reform Commission is mainly based on the regulation of career prosperity, in order to prevent excessive fluctuations in career profits. Secondly, according to the regulation of energy conservation and emission reduction, the purpose is to respond to China's reduction of energy consumption and environmental pollution in the process of industrial production.

Experts pointed out that whether from the perspective of fire-proof glass career prosperity or from the perspective of macro-control, there is little possibility of excessive capacity expansion of fire-proof glass career in 2008. The most likely situation is the return of the occupation to the normal profit level, and the willingness of occupation investment is gradually strengthened. However, according to the macro-control of energy conservation and emission reduction, it will be more difficult and longer to convert this willingness to invest into actual investment.