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07 Jul | On the Radar – West China Cement

We’ve gone and added another Chinese AIM company to the Investor Trader Radar, West China Cement. To be honest I’ve made a few pennies out of West China Cement in early to mid ’07, when everyone was clambering on board the Chinese Investment Express.

Since then, it has risen to levels nearing three quid and plumbed the depths at below 50 pence and now sits somewhere roughly in between at £1.75. For three consecutive years since 2006, West China Cement has been listed by Forbes as one of the top 100 Chinese Companies with Growth Potential.

I’ve visited China a couple of times over the years (first back in 1998 and then again in 2008) and the construction going on in the cities where I’ve been is mind boggling. Now you could write a book on what I don’t know about large scale construction, but one thing I do know is that it takes a hell of a lot of cement.

To give you an idea of the scale of China’s demand for cement, West China Cement has a current capacity to produce 5.3 million tonnes of the stuff from its three plants, making it the 28th largest producer in China. The whole of the UK’s annual production is in the region of 8 million tonnes.

With further expansion on the horizon (a fourth plant producing a further 2 million tonnes) and a government driven to getting behind modern, local business, West China Cement may just find its way into our portfolio sooner rather than later.

Please do your own research, following anything I say or do could quite possibly make you bankrupt in the very near future 🙂