According to the Financial Associated Press (Chengdu, reporter Su Qitao), benefiting from the blowout of market demand, the lithium industry chain continued to improve, and the share price of “mining” Tianqi Lithium (002466.SZ) soared. Since November last year to the close on August 27 this year, the stock price has risen more than five times in 10 months, and the market value has exceeded 190 billion yuan. The just-disclosed interim report also showed that the company’s performance in the first half of the year improved significantly, achieving revenue of 2.351 billion yuan, a year-on-year increase of 25.13%; achieving net profit attributable to the parent of 85.797 million yuan, a year-on-year increase of 112.32%, turning losses into profits.
For the performance growth, the company explained the main reasons: first, the sales volume and price of lithium chemical products increased significantly compared with the same period of the previous year, and the total operating income and gross profit increased; Some SQM’s Class B-share collar options business generated an increase in fair value gains from the same period last year; third, during the reporting period, the company’s interest expenses decreased by 324 million yuan from the same period last year.
A reporter from the Financial Associated Press learned from a person in the lithium industry that there is a high probability of lithium products in the second half of the year. The price increase and demand expansion of lithium products are currently mainly driven by the large demand for downstream new energy vehicles. In addition, mobile phones and other electronic products Demand-driven is also good.
The so-called “there is lithium everywhere”, the stock price of Tianqi Lithium has soared because of “there is lithium”. Relevant persons of the company told the Cailian News that the company currently has a production capacity of about 44,800 tons/year of lithium chemical products, and there are also 48,000 tons/year lithium hydroxide and 20,000 tons/year battery-grade lithium carbonate projects under construction. The planned production capacity of lithium chemical products in the medium-term totals more than 110,000 tons/year. In the future, the company will look for more like-minded investment and business partners, and comprehensively consider project construction methods based on market trends, company liquidity, project feasibility and other factors, in order to increase market share.
The interim report disclosed that Tianqi Lithium’s lithium product processing business currently mainly relies on the production bases in Shehong, Sichuan, Zhangjiagang, Jiangsu, and Tongliang, Chongqing, to provide lithium carbonate, lithium hydroxide, lithium chloride, and lithium metal products. The Zhangjiagang base has global The first fully automated battery-grade lithium carbonate production line; in addition, the company has two phases of battery-grade lithium hydroxide production lines with a total annual output of 48,000 tons in Quinana, Western Australia, which are under construction and commissioning (the first phase of the project has entered phased commissioning, The second phase of the project is in a state of suspension), and the construction of a battery-grade lithium carbonate production line with an annual output of 20,000 tons in Suining Anju has started (currently in a state of suspension).
Regarding the progress of the project, the above-mentioned company sources told reporters that the commissioning work of the first phase of the Quinana project is proceeding normally according to the established plan. At present, it is still committed to achieving stable operation of the whole process and optimization of process control parameters, and strive to achieve the achievement of the project by the end of 2021. The state of sales products, the factory enters the phased goal of formal operation and trial production; during the trial production process, the company will promptly carry out targeted rectification work according to the problems that occur, so that the project will gradually reach a continuous and stable production state, in order to achieve At the end of 2022, the final goal of design capacity will be reached. The main part of the second-phase project has been basically completed, but in view of the strong correlation between the second-phase project and the first-phase project, the company will effectively verify the mature operation of the first-phase project and then combine market demand, company liquidity and other conditions to comprehensively demonstrate and Adjust the construction plan of the second phase lithium hydroxide project.
Anju’s project with an annual output of 20,000 tons of battery-grade lithium carbonate has previously completed a feasibility study and is an important part of the company’s mid-term capacity plan. In the early stage, due to the company’s capital pressure slowing down construction, the subsequent company will also consider market conditions. Whether to seek some positive ways to demonstrate the timing of restarting construction.
In addition, public information shows that Tianqi Lithium is one of the very few companies in the world that simultaneously deploys high-quality lithium mines and salt lake brine mines. The company Shenghe Lithium owns the mining rights of the Cuola spodumene mine in Yajiang County, Sichuan, which have 8.78 million tons and 630,000 tons of lithium resources respectively. At the same time, the company has realized the layout of high-quality salt lake lithium resources through equity participation in Xigaze Zabuye and SQM. The two have 1.83 million tons and 45.51 million tons of lithium reserves respectively. But the only mine currently producing lithium is the Greenbush mine in Australia.
The company said that with the rapid growth of global new energy vehicle sales and the active replenishment of the industrial chain, in the long run, sufficient resource reserves will help enhance the company’s bargaining power and industrial chain status.
It is worth mentioning that the issue of corporate debt, which is generally concerned by the market, is gradually improving. In 2018, in order to complete the acquisition of SQM’s equity purchase of new M&A loans of US$3.5 billion, Tianqi Lithium’s asset-liability ratio and financial expenses increased significantly. According to the mid-year report, after repaying the syndicated loan by raising 2.905 billion yuan through allotment in January 2020, the company actively expanded new financing channels, accelerated the advancement of equity financing, and strived to further optimize the debt structure. After the company signed the “Investment Agreement” with Australian investor IGO on December 9, 2020, in the first half of 2021, it has successively reached the pre-delivery conditions stipulated in the “Investment Agreement” and received all transaction considerations on July 2, 2021 .
“Since the fourth quarter of 2020, with the extension of syndicated loans, the successful advancement of overseas strategic investors, and the financial assistance of the controlling shareholder Tianqi Group, coupled with the gradual recovery of the lithium industry, the sales volume and price of lithium products have risen steadily, and the company has flowed The company’s debt-to-asset ratio has been reduced to about 63%.” The company said that the company is continuing to promote the demonstration and implementation of equity financing tools that help reduce the company’s financial leverage, including but not Limited to the introduction of strategic investors, H-share issuance, private placement, market-based debt-to-equity swaps, etc., to resolve debt pressure as soon as possible and return the company’s debt-to-asset ratio and financial leverage to a reasonable level.