\u3000\u3000 Suzhou Ta&A Ultra Clean Technology Co.Ltd(300390) (300390)
Event: Suzhou Ta&A Ultra Clean Technology Co.Ltd(300390) released the 2021 annual report. In 2021, the net profit attributable to the parent company was 911 million yuan, with a year-on-year increase of 218.44%, of which the net profit attributable to the parent company in 2021q4 was 360 million yuan, with a year-on-year increase of 541% and a month on month increase of 51.6%. In 2021, the net profit not attributable to the parent company was deducted by 860 million yuan, a year-on-year increase of 274.5%, of which the net profit not attributable to the parent company was deducted by 363 million yuan in 2021q4, a year-on-year increase of 64.9 times and a month on month increase of 55%.
Lithium salt business volume and price increased simultaneously, and the company’s performance increased significantly. In terms of gross profit, the gross profit margin of lithium battery business is 58.7%, contributing 1.36 billion yuan of gross profit, accounting for 78.3%. Specifically, in 2021, the first phase of the 20000 ton battery grade lithium hydroxide project of Tianyi lithium industry (now holding 68% and plans to increase its shareholding to 75%) was completed and put into operation. The annual sales revenue of lithium hydroxide was 2.315 billion yuan, and the net profit was 1.081 billion yuan. The company confirmed 735 million yuan in proportion, Accounting for about 80.7% of the profit attributable to the parent company. (1) Production capacity: 20000 tons of lithium hydroxide has reached production capacity, and the annual output is 23600 tons. (2) Price: in 2021, the average price of battery grade lithium hydroxide was 114100 yuan / ton, with a year-on-year increase of 120.3%, of which the average price of Q4 was 190200 yuan / ton, with a year-on-year increase of 294.2% and a month on month increase of 63%.
At the smelting end, the capacity of lithium hydroxide is planned to be about 160000 tons, and began to enter the field of lithium carbonate. (1) The first phase of Tianyi lithium industry has a capacity of 20000 tons of lithium hydroxide, and the design capacity of 5000 tons will be added after the completion of the supporting technical transformation project; The phase II 25000 ton battery grade lithium hydroxide project has entered the stage of commissioning and trial production and produced qualified products. At the same time, the 50000 ton capacity of Jiang’an base and 60000 ton capacity of Meishan base will be completed by stages by the end of 24. At that time, the total capacity of lithium hydroxide of the company will reach 160000 tons per year. The company plans to issue shares to promote capacity expansion projects, and the planned capacity is expected to be steadily implemented. (2) It is proposed to jointly invest with Contemporary Amperex Technology Co.Limited(300750) to build a 100000 ton lithium carbonate smelting capacity project, which is the company’s first production of lithium carbonate and will increase 10000 tons of lithium salt equity capacity.
The resource side holds the AMG underwriting right and focuses on the future of Manono. (1) According to the announcement of the company, from 2021 to 2023, the company holds the sales volume of AMG 60000-90000 T / a package, and both parties reach an agreement that they can choose to extend it for another two years. (2) Tianyi lithium is the largest shareholder (7.38%) of avz, and its Manono mine may have increased reserves (5.31 million tons of LCE, the previous value of 3.63 million tons of LCE). In addition, avz and Tianhua times are expected to increase the mining and beneficiation volume to 10 million tons / year, corresponding to the production capacity of 1.6 million tons of lithium concentrate. In terms of underwriting, after the completion of Tianhua times’ acquisition of 24% equity of Manono, Tianyi lithium will transfer the rights and obligations of the original off take agreement to Tianhua times, which has a package sales volume of 800000 tons / year and a lower 50% output of Manono. In the future, Tianhua times will supply spodumene concentrate to Tianyi lithium for a long time according to the needs of Tianyi lithium, with a supply quantity of no less than 200000 tons / year.
Client, Suzhou Ta&A Ultra Clean Technology Co.Ltd(300390) and Contemporary Amperex Technology Co.Limited(300750) cooperate in depth, with obvious growth attributes. The two sides have multi-level cooperation in resources, smelting and equity. In 2021, the company actually sold 450 million yuan of battery grade lithium hydroxide to Contemporary Amperex Technology Co.Limited(300750) . It is estimated that the total amount of battery grade lithium hydroxide to be sold by the company and Tianyi lithium with related parties Contemporary Amperex Technology Co.Limited(300750) and related parties in 2022 will not exceed 2.8 billion yuan (excluding tax). In addition, in 2021, the company purchased about 800 million yuan of raw materials from Contemporary Amperex Technology Co.Limited(300750) (excluding tax), of which the price range of lithium concentrate was 2602-8239 yuan / ton, slightly lower than the average market price in the same period. The company actively expanded its production capacity and bound its core partners in both raw materials and sales channels, with obvious growth attributes.
Investment suggestion: we expect that the company’s operating revenue from 2022 to 2024 will be RMB 11.345 billion, RMB 15.135 billion and RMB 16.793 billion respectively, and the net profit will be RMB 2.393 billion, RMB 3.789 billion and RMB 4.11, RMB 6.5 and RMB 8.03 per share respectively. At present, the corresponding PE share price is 16.1, 10.2 and 8.2 times. It is rated as “overweight-a”, with a 6-month target price of 80 yuan / share.
Risk tip: lithium price is lower than expected, demand is lower than expected, and project progress is lower than expected
