Concrete - how boring! This seems to be the take of most when they hear China ACM mentioned. Not sexy.
Me, I am totally impressed, am floored. Haven't been to China, but of course I read reports form many who travelled there repeatedly. Whichever city they touched down: yet another boomtown with cranes everywhere. In an earthquake prone country (and elsewhere too), this mean lots and lots of reinforced concrete. 41,000 additional km of new rail lines? Got to pour concrete. Highrises, bridges, subways, infrastructure, power stations: got to pour concrete. The business opportunities are solid as can be, as long as management keeps the company at the competitive forefront. And our management does indeed impress me as capable.
Even here in Southern Europe, I see the new shiny ready-mix concrete vehicles swarming the cities like busy bees. The old fashioned way of preparing the stuff on site is definitely just a memory, and not necessarily a fond one. It is also important to appreciate the large capital investment of the dominant players in any locality. Only financially strong companies could mount a credible challenge, but not the myriad of small timers. I would expect that over time China ACM will come accross oportunities to acquire competitors on the cheap - or eat their lunch.
A year ago in Dubai, my impression was the same as in my home town, only much, much more so. Underneath the shiny new mega-cities springing up you will find a foundation of ready-mix contrete everywhere. And Dubai is a pip-squeek compared to China and its plans/necessities.
So China ACM looks like an impressively strong - and long term - investment to me, just as if made from heavily reinforced ready-mix concrete. My shares? Not for sale.
