Holcim: 3 takeaways from our roadshow in Edinburgh

研报英文原文证据摘录

Holcim: 3 takeaways from our roadshow in Edinburgh

tive (%) (5.8) 4.6 (3.5) 47.5

with further government support. Source: Bloomberg, Bernstein estimates and analysis.

ETS debate led to a sharp stock derating driven which was overdone because of 3 Price Performance, 1YR

main misunderstandings in the market: (i) There was a view in the market that Holcim were CHF90 1700

already using carbon credits in price negotiations, which is not the case because small CHF80 1600

residential customers don’t have price discussions and large (infra) customers know Holcim CHF70 1500

are long allowances until 2031, so current pricing is largely driven by Holcim’s strong

footprint in structurally attractive market with high pricing power.(ii) Another misconception CHF60 1400

was that Holcim had spent a lot on decarbonisation/CCS, which is again not true. Holcim CHF50 1300

have plans to build 7 CCS plants, however, they will only take FID if payback is <10 years, 06/25 09/25 12/25 03/26 06/26

for that they need carbon price visibility or further government subsidies (above the ~45% HOLN.SW EDME

capex subsidy they have got from the EU innovation fund) or some derisking mechanism.

Further, Holcim are very happy with the relatively small investments they have made to

increase their alternative fuel rate and reducing their clinker rate, because it has not

just decarbonised the portfolio but also makes Holcim less susceptible to volatile energy

prices. (iii) There is a misunderstanding that the pricing power is dependent on broadbased

capacity rationalisation. Holcim believe market consolidation will happen only in markets like

Germany, Austria, etc. in Europe which are more fragmented but not much in others. As we