.

This one is on a current year PER of just over times 2, and a forward PER of under times 2. Makes it very cheap.

I had a change of stance on this one and have been buying in since 120p levels, and see the potential here to do a "SOLA" given over 1 pounds of earnings forecasts for next year.


Broker forecasts :


Evolution Watter... 31-03-09 BUY

2009 PTP 56.62m
2009 EPS 78.63p

2010 PTP 75.94m
2010 EPS 104.57p

Another benefit for WCC now, as investement goes, is that it is past the 100 million pounds market cap level.

As is known, recently all stocks under 100m were classed as "micro-cap" by many hedge funds, which will make them "untouchable" to those funds however WCC has crossed that point, and with such outstanding potential is surely going to be of interest to many a hedge fund manager looking for a stock with very high growth potential, but one that is also liquid and above a market cap barrier of 100m and also has the enviable position of having the next few years of their growth pretty much lined up and in the bag already with the effects of the China Domestic Stimulus package.

On the up again today, its difficult to get your head around it, when you see over 100p of earnings forecast for next year, but thats what it is.

Times 6 = 600p.

Many other cement stocks in Asia are presently on times 20 or more. Not worth thinking about, getting to times 6 is already presently considerable upside.

Will it break upwards through 200p before close today, ahead of the long weekend ?

That would put it on a PE of times 2 for 2010 results.........or of times 3 for 2009 results...........

Plenty of upside to come, and a strong rerating over the remainder of 2009 should be happening.

Going over the 100m market cap level now makes this "attractive" and "possible" for hedge funds to start buying, and given the outlook for demand and therefore the strength of the outlook, it must be attractive to some. Would be good to see some chunks getting purchased now and a strong move into the low 200's.

.

Fundamentals and forecasts for WCC :


http://www.digitallook.com/cgi-bin/dlmedia/security.cgi?ac=&csi=201989&username=


.

Quite stunning when you compare peers on other markets.

I notice that there is a sell note out on "Anhui Conch" who are a cement producer in Anhui. The note says the PER of times 21 is too high, and a new targer price of PER times 17 of current year forecast.


LOL.


Put WCC on current year forecast of 17 times and you get 17 x 1190p (yes near 12 pounds).

Do that again next year and you get 17 times 1785p (year near 18 pounds).

Now its never going to achieve that kind of rating on the AIM market, but they are looking to dual list as part of their loan deal announced last year.

Given the outlook, the peer group ratings on other markets and the liklihood of a dual listing then WCC certainly should fall into most peoples "put some in the bottom drawer" and keep for a couple of years kind of investment.

Not that many potential multibaggers out there, especially ones presently on a PER of less than times 3 and one that is profitable and expanding, now, through the use of internally generated cash.

Couple of media articles, one from Nov last year highlighting that WCC is likely going to be a big beneficiary of the Domestic Stimulus plan in China, and a more recent one from PI, snippets from both below :

http://wallstreetpit.com/998-chinas-585-billion-renovation

................Most of the bailout package will be spent on the raw materials and service-suppliers needed to build roads, bridges, and other infrastructure. We should be looking at companies who operate exclusively in that space. Here’s a few we would consider pure-plays on China aggressive infrastructure spending:

West China Cement (LSE: WCC) is definitely going to be very busy. It produces and sells cement, using environmentally sound practices, under the brand ‘Yaobai Cement’. It has three production lines in the Pucheng area (100 miles north of Xi’an) which can crank out 1.5 million tons of cement a year. A massive new plant, however, is scheduled to be completed in the next six months, bringing total production to 5.8 million tons. West China Cement had sales of about U.S. $430 million last year. Its profits and operating income increased about 70% from the previous year.

Guangshen Railway (NYSE: GSH) is a $107 billion transportation....................


-----------------------

http://www.proactiveinvestors.co.uk/companies/news/5073/west-china-cement-record-sales-and-approval-for-two-new-plants-in-earthquake-reconstruction-area--5073.html?WCC

..................The company is to set to supply a number of large infrastrucuture projects with cement over the next two or three next years as the Chinese government invests a large sums of its economic stimulus package on roads, railways and post-earthquake reconstruction in Western China.

The company also Monday announced approval for its Hanzhong ........................

LOOKING GOOD.

More good news today for WCC and the like as "cement stocks" were strong in Asian trading today on news of potential for yet more increased demand.


http://www.forbes.com/feeds/afx/2009/04/30/afx6358749.html

Thomson Reuters
China stocks rise 0.8 pct; property, cement strong
04.30.09, 01:04 AM EDT

SHANGHAI, April 30 (Reuters) - Chinese stocks rose 0.83 percent on Friday, with property and cement shares strong after a cut in capital requirements for investment projects while Shanghai-based firms ga.................

http://www.investegate.co.uk/Article.aspx?id=200905051204196840R

AGM result out, interesting........


RNS Number : 6840R
West China Cement Limited
05 May 2009

Result of Annual General Meeting

The Company is pleased to announce that all resolutions proposed at its Annual General Meeting, held earlier today, were duly passed by shareholders.

Brett Miller, Non-Executive Director, made the following remarks in response to a shareholder enquiry:

'Whilst AIM has served West China Cement very well, the Directors believe that a move to the Hong Kong Stock Exchange or London Stock Exchange Full List might be a natural progression for the Company. At the appropriate time, the Board will need to consider the merits, implications and timing of such a listing in detail. However, the Company's main focus at present is the operations of the business and managing the Company's growth, particularly in light of the recent announcement to build two new cement plants in the South West Shaanxi province.'

Enquiries:
Brett Miller, West China Cement Limited
Tel: +44 20 7584 3663


Christopher Caldwell or Emma Brewer, NCB Stockbrokers Ltd
Tel: + 44 20 7071 5200

Some large trades in there today, and the time they go through and the price kind of suggests that someone is buying lumps of WCC and builing a larger holding. Looks to me like institutional buying is going on, and who can blame them. If they can pick up a million of so WCC at sub 300p and wait a couple of years, they should be looking at quite spectacular gains.

Update from IC on 6th April :

http://www.investorschronicle.co.uk/

Tip update

BUY

WCC’s share price has rebounded in 2009 and it’s roughly where it was 12 months ago. Broker Evolution forecasts 2009 revenues of RMB 1.44m and nearly doubled net profits of RMB490m. Buy.

For those interested in a bit more detail of WCC, there are 5 MM's on WCC this being EVO, WINS, SCAP, LIBR and KBC.

Presently quite strong at 5 v 1 at 184/189



.

Mentioned in the Times today under "Tiddler to Watch", snippet below, full article on the link.

http://business.timesonline.co.uk/tol/business/markets/article6252183.ece

".............Tiddler to watch

Shares in West China Cement, the cement producer located......................"


-----------------------


Little bird also says they got a write up in SCSW this weekend ( http://www.scsw.co.uk/ ) so it would seem that more and more people are getting to know a bit more about WCC and its potentially very exciting future and outlook.


.

Looks like a small consolidation with profit taking/top slicing by some is now over.

Looking stronger, and it also appears some institutional buying has been going on.

Alan Gibbs at Waverton appears very bullish on West China Cement (WCC).

I agree with him on this company, perhaps not on some of his other views.


http://www.citywire.co.uk/adviser/-/news/fund-manager-views/content.aspx?ID=340459&Page=2

http://www.trustnet.com/News/Printable.aspx?scope=Offshore&id=36568


.

Outlook statement from China Shuangji Cement's final results which were released on last Friday :

Business Outlook:

The Company is currently building a new 1 million metric ton cement plant outside Zhaoyuan City to replace the old Zhaoyuan plant and will be completed in July 2009. The Company acquired fifty-one percent ownership in a 300,000 metric ton plant in nearby Longkou, Shandong in April 2009 and will upgrade capacity to 500,000 metric tons by July 2009.

"We foresee positive business sales in the fiscal first quarter and beyond due to the Chinese Government decision to shut down a collection of small cement plants by the end of 2010 and the Chinese Government's recently announced 4-trillion-RMB ($586 billion) economic stimulus plan. This will result in expanding our cement market and increased commodity price for cement," stated Mr. Song.


Which confirms that the government is actively shutting down smaller and polluting cement producers (ones which also produce inferior grade cement) and they are encouraging the growing producers who utilise new plants and new cleaner technology. Which is why WCC is forecast to make over 100p of earnings in 2010, and much higher levels again in 2011 when all the plants presently planned contribute to a full year of revenue and profits.

WCC will continue to grow their output as demand is robust from not only continued construction projects, but also the shutting down of smaller cement producers.

Strong again today. When you look at the development of "expressways" in China (which in the UK would be classed as motorways) its quite staggering.

Again a benefit here is that expressways are now being built more so in central and western China, along with lots of cement roads replacing mud ones, and so, being in the right place where the demand is, a company like WCC can grow very strongly in the coming years.

Historical Development of Expressway Length in China

Year Distance (KM)

01-01-1988 0

01-01-1989 147

01-01-1990 271

01-01-1991 522

01-01-1992 574

01-01-1993 652

01-01-1994 1145

01-01-1995 1603

01-01-1996 2141

01-01-1997 3422

01-01-1998 4771

01-01-1999 8733

01-01-2000 11605

01-01-2001 16314

01-01-2002 19453

01-01-2003 25200

01-01-2004 29800

01-01-2005 34300

01-01-2006 41005

01-01-2007 45339

01-01-2008 53913

01-01-2009 60346

01-01-2010 65000 (projected)

Good news for WCC, as the price of electricity/coal is a major cost for cement producers. Over-capacity and weak prices is excellent for boosting margins, and boosted they should be in 2009 and 2010 at this rate.

http://www.mineweb.net/mineweb/view/mineweb/en/page38?oid=83752&sn=Detail


Is China headed for coal production overcapacity?

China's voracious energy demands notwithstanding, a China Coal Industry official suggests a trend for overcapacity may be emerging.

Author: Dorothy Kosich
Posted: Monday , 25 May 2009

RENO, NV -

The deputy director of the China Coal Industry Association says "weak demand has resulted in a clear trend for overcapacity" in the country's coal industry.

The nation's coal production incre...............