Huaxin Cement (6655 HK): Floats Non-Chinese Ops Spin-Off
Two days after announcing its 2025 interims, Holcim (HOLN SW)-backed Huaxin Cement (6655 HK) proposed spinning off its overseas cement assets.
The overseas ops, predominantly located in Africa, significantly outperformed the PRC ops in FY24, a trend that continued into 2025.
No preferred bourse was stipulated, although the HKEx appears the logical choice. Pegged to historical trading metrics, Huaxin appears fully valued here.
The Trade:
A spin-off makes sense as the outperformance of the overseas ops are weighed down by the underperformance of the domestic ops.
Huaxin's H shares are up 36% since mid-July, and 78% YTD.
Metrics appear full here.
And short interest is spiking.
This insight is labelled bearish as I'm not bullish here.
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