With the release of the annual report of Ganfeng Lithium, a Chinese lithium battery giant with a market value of nearly 180 billion, the report card of the lithium battery industry has also entered the peak period of release.
The Beijing News Shell Finance reporter found that as of the morning of March 31, 60 lithium battery concept stocks had released their 2021 annual reports, and Ganfeng Lithium’s net profit growth rate of 410.26% could only rank ninth .
Affected by the rapid development of the new energy vehicle industry, the surge in demand for lithium batteries, and the shortage of lithium products, lithium battery concept stocks made a lot of money last year. So far, 5 lithium battery stocks have increased their net profit by more than 10 times, and 34 lithium battery companies The net profit of shares has doubled, and the growth of the top three is even more dazzling – the net profit of Skyline shares has increased by 7011.34% year-on-year, the net profit of Shengxin Lithium has increased by 3030.29% year-on-year, and the net profit of Defang Nano has increased by 2918.83% year-on-year.
There are still many lithium battery concept stocks that have not released annual reports, but according to the performance forecast, they also have the potential to hit the forefront of the “profit-making list” in the lithium battery industry. Net profit is expected to rise by up to 260%.
Huaan Securities believes that as the demand side is driven by the new energy sector, lithium demand has maintained rapid growth and is expected to continue to exceed market expectations, while on the supply side, leading lithium resource suppliers such as overseas salt lakes and Australian lithium mines have been slow to expand production and release production capacity. It takes time to verify, and the supply increment in the next 2-3 years will be limited. It is estimated that in 2021-2023, the shortage of lithium supply will be 10,000, 1.4, and 8,000 tons of LCE. “Lithium supply and demand is expected to be in a tight balance, the high prosperity will continue, and the lithium price center will remain high supported by the relationship between supply and demand.”
Skyline shares surge in net profit7000%“Profit King”Tianqi Lithium hits the “making money list”
The reporter’s statistics found that so far, the net profit of 5 lithium battery stocks has increased by more than 10 times, and the net profit of 34 lithium battery stocks has doubled.
Ganfeng Lithium’s report card on the evening of March 30 was quite eye-catching. In 2021, the company achieved revenue of 11.162 billion yuan, a year-on-year increase of 102.07%; net profit attributable to the parent was 5.228 billion yuan, a year-on-year increase of 410.26%; The profit was 2.907 billion yuan, a year-on-year increase of 622.76%; the basic earnings per share was 3.73 yuan per share.
However, the 2021 report card of lithium battery stocks is generally positive, and Ganfeng Lithium’s net profit growth can only temporarily rank ninth among lithium battery stocks.
The “profit king” of lithium batteries in 2021 is undoubtedly Skyline.
In 2021, Tianji Co., Ltd. will achieve an operating income of 2.253 billion yuan, a year-on-year increase of 203.24%; a net profit attributable to the parent company of 745 million yuan, a year-on-year increase of 7011.34%; and a non-net profit of 741 million yuan, a year-on-year increase of 4402.81%.
Tianji shares can achieve the above results, all rely on the lithium industry.
The company’s annual report shows that lithium hexafluorophosphate is an important raw material for lithium batteries, mainly used in energy storage batteries, power batteries and digital, lighting series lithium batteries and other products. Among the company’s current two main businesses of lithium hexafluorophosphate and small household appliances, the sales revenue of lithium hexafluorophosphate accounts for more than 80%, and the sales revenue of small household appliances business accounts for less than 20%. The profit mainly comes from the lithium hexafluorophosphate business.
On the one hand, the company achieved an actual output of 9,364 tons with a designed production capacity of 8,160 tons of lithium hexafluorophosphate, doubling the actual output of 4,602 tons in the previous year, and its net profit was the best annual performance since the company went public. On the other hand, the company’s small household appliance business is still operating in difficulties and is in a state of loss.
The second “little expert to make money” is Shengxin Lithium Energy. The annual performance report released on the evening of March 29 shows that the operating income in 2021 is about 2.934 billion yuan, an increase of 63.88% year-on-year; the net profit attributable to the parent is about 851 million yuan, a year-on-year increase An increase of 3030.29%.
In addition, Long-term Lithium’s net profit increased by 538.17% year-on-year, ranking sixth; Zangge Mining’s net profit increased by 523.60% year-on-year, ranking seventh; Hainan Mining’s net profit increased by 513.55%, ranking eighth.
Although not close to the top ten, there are still many listed companies performing well: Tianci Materials’ net profit increased by 314.42% year-on-year, ranking 13th; Weilan Lithium Core’s net profit increased by 141.09%, ranking 26th.
There are still many lithium battery concept stocks that have not released annual reports, but according to the performance forecast, they also have the potential to hit the forefront of the “profit-making list” in the lithium battery industry.
Tianqi Lithium expects to achieve a net profit of 1.8 billion to 2.4 billion yuan in 2021, while the company lost 1.833 billion yuan in the same period last year. According to preliminary calculations by the reporter, Tianqi Lithium’s net profit attributable to its parent may increase by as much as 230%, turning losses into profits.
Tianqi Lithium Industry said that the main reason for the company’s profitability is the impact of multiple positive factors such as the improvement of the global new energy vehicle boom, the accelerated capacity expansion of lithium-ion battery manufacturers, and the recovery of downstream cathode material orders. The company’s main lithium products in 2021. Both sales volume and average sales price increased significantly compared with 2020.
Huayou Cobalt expects to achieve a net profit of between 3.7 billion and 4.2 billion yuan in 2021, a year-on-year increase of 217.64%-260.56%. The company said that in 2021, the demand for new energy lithium battery materials will continue to grow rapidly, the production and sales of the company’s main products will increase, the sales prices of products will continue to rise, and profitability will be greatly improved.
Yiwei Lithium Energy expects to achieve a net profit of between 2.7 billion and 3 billion yuan in 2021, a year-on-year increase of 65%-85%. The company said that during the year, the company’s sales expanded and its operating income increased by more than 100%. Among them, the business of consumer batteries and power storage batteries has grown significantly, and profits have increased.
Expensive raw materials lead to more expensive productsThe average price of Ganfeng Lithium’s lithium series products has risen49%
Lithium prices have risen sharply since last year.
The reporter learned that the distribution of global lithium resources is extremely uneven, and most of the supply comes from salt lakes and hard rock lithium mines. Among the major types of lithium mines currently being developed in the world, salt lake brine type lithium mines are the most important type of deposits, accounting for 75% of the global lithium resource reserves, and are also the dominant direction of lithium industrial mining, while mature salt lakes are mainly distributed in South America. Triangle and China. On the other hand, Australia is the world‘s largest producer of lithium ore, and most of the lithium mines are still concentrated in Western Australia, accounting for about 90% of the world‘s lithium ore supply.
Lithium has been in short supply in recent years. According to the Minmetals Securities Research Report, the global ore lithium production (in the form of concentrate) increased significantly from 88,000 tons of LCE to 319,000 tons of LCE from 2016 to 2021, while the global salt lake lithium production increased from 126,000 tons of LCE to 256,000 tons of LCE. However, the global demand for LCE in 2021 is 606,200 tons.
However, affected by the spread of the epidemic and the low lithium price in 2020, lithium resource companies have reduced capital expenditures and slowed down the progress of project expansion in 2020. Therefore, the new supply of lithium resources in 2021 is limited, and the market is still in a tight balance of supply less than demand.
Because of the imbalance between supply and demand, the price of lithium keeps rising. According to data from Shanghai Nonferrous Metals Network, as of February 2022, the CIF price of 5%-6% spodumene concentrate in China is about US$2,610-2,660/ton, an increase of 502% from the price of US$400-435/ton at the beginning of 2021. %-565%.
What’s more, in the context of carbon emission reduction and the development of new energy, the electric vehicle industry has entered a golden period of development. According to data released by the Ministry of Industry and Information Technology, in 2021, in the Chinese market, the production and sales of new energy vehicles will be 3.545 million and 3.521 million respectively, a year-on-year increase of 1.6 times, ranking first in the world for seven consecutive years.
Ganfeng lithium battery annual report shows that in recent years, due to the rapid development of new energy vehicles and energy storage system industries, the rising demand for power batteries has led to the rapid expansion of demand for lithium iron phosphate materials and ternary materials, and the demand for electric vehicles and power batteries will be released and converted. For actual production, further stimulate the demand for lithium. The industry has gradually shifted from a balance of supply and demand to a state of tight supply. Stimulated by the relatively tight supply of lithium compounds and rising industrial demand, the price of lithium compounds has continued to rise since 2021.
This is also reflected in the financial reports of many listed companies.
Ganfeng Lithium’s fuel and power costs in 2021 will increase by 106.73% year-on-year; the cost of raw materials consumed will increase by 51.59% year-on-year.
Affected by this, Ganfeng Lithium has increased the price of its products.
The annual report shows that the average selling price of Ganfeng Lithium’s lithium series products in the first half of the year was 72,200 yuan, and the average selling price in the second half was 107,700 yuan, an increase of 49.12% year-on-year; the price of lithium battery series products in the first half of the year was 15.18 yuan 10,000 yuan, the selling price in the second half of the year was 173,200 yuan, and the average selling price increased by 14.10% year-on-year. These price increases are precisely the impact of the upward trend in the lithium salt product market.
Tianji Co., Ltd. also admitted that due to the tight supply of the new energy automobile industry chain, in 2021, the price of the company’s three main raw materials, lithium hexafluorophosphate, rose sharply compared with 2020, resulting in an increase of more than 300 million yuan in the company’s procurement expenditure, but thanks to the company’s lithium hexafluorophosphate product market sales The rise in prices has absorbed the adverse effects of rising prices of major raw materials.
The company’s annual report shows that the average price of lithium fluoride per ton including tax in 2020 is 101,500 yuan. By 2021, the average price including tax per ton will reach 185,700 yuan.
The same is true of Shengxin Lithium Energy. In the annual report, Shengxin Lithium Energy disclosed that the average price of the company’s products in the first half of the year was 59,900 yuan, and the average price of its products in the second half of the year was 116,800 yuan. The average price increased year-on-year. In the performance briefing of Shengxin Lithium Energy, the company mentioned that benefiting from the rapid development of new energy vehicles and other fields, the demand for lithium salt industry is relatively strong.
resources are kingBattery recycling and lithium extraction
It is precisely because of the tight demand for lithium batteries that recently, listed companies have snapped up lithium mines. Huaan Securities also put forward the statement that “resources are king and development is accelerated”.
In 2021, Ganfeng Lithium has successively made a tender offer for Bacanora and obtained its control, acquired 100% of the property shares of Yili Hongda and indirectly held 49% of the equity of Qinghai Yiliping Salt Lake Project, and acquired Goulamina Spodumene Project in Mali 50% equity.
In September 2021, Shengxin International, a wholly-owned subsidiary of Shengxin Lithium Energy, signed an agreement with STELLAR INVESTMENT PTE. The Morowali Industrial Park (IMIP), Morowali County, Weixi Province invested in the construction of a lithium salt project with an annual output of 60,000 tons. The total investment of the project is about 350 million US dollars; Shengxin International holds a 65% stake in the joint venture.
Huayou Cobalt also joined the lithium track in December 2021. Huayou Cobalt announced at the time that the company planned to acquire the prospective lithium mine in Zimbabwe for US$422 million through its subsidiary Huayou International Mining.
Huayou Cobalt said that the acquisition of the Arcadia project will help the company strengthen the layout of upstream lithium resources, enhance the resource reserves required for new energy materials for lithium batteries, and form a strong resource guarantee for the company’s mid- and downstream industrial chain.
Regarding the overweight lithium battery track of enterprises, Huaan Securities specifically analyzed the situation of lithium mines in my country, saying that China’s spodumene mines are mainly concentrated in the Sichuan area, with good resource endowments and low degree of development.
Jika in Ganzi Prefecture and Keerin in Aba Prefecture are the two main mining areas of spodumene in Sichuan, with relatively concentrated distribution, including six mines with mining rights, and six mines have ore reserves of 160 million tons, equivalent to lithium oxide. The reserves are over 2 million tons, and the only mines currently being mined are Mika and Yelonggou Lithium Mine, and the rest are in the early stage of the project. Sichuan has a good lithium resource endowment, with an average grade of 1.3%-1.4%. Sichuan spodumene resources and deposits are in urgent need of development.
In addition to overweight salt lakes and hard rock lithium mines, lithium battery companies are also interested in recycling lithium.
Ganfeng Lithium said that with the use of automobiles and consumer electronic products, the demand for the disposal of retired batteries continues to increase, the company’s lithium battery recycling business has great growth potential, and further enriches the source of lithium raw materials.
In future plans, the company will build a large-scale complex that can recycle 100,000 tons of decommissioned lithium batteries per year. The company continues to expand its business downstream by expanding its lithium battery recycling business capacity and expertise in recycling and reusing decommissioned batteries.
Huaan Securities believes that as the demand side is driven by the new energy sector, lithium demand has maintained rapid growth and is expected to continue to exceed market expectations, while on the supply side, leading lithium resource suppliers such as overseas salt lakes and Australian lithium mines have been slow to expand production and release production capacity. It takes time to verify, and the supply increment in the next 2-3 years will be limited.
Huaan Securities estimates that in 2021-2023, the lithium supply shortage will be 1.0, 1.4, and 8,000 tons of LCE. “Lithium supply and demand is expected to be in a tight balance, the high prosperity will continue, and the lithium price center will remain high supported by the relationship between supply and demand.”
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