\u3000\u3000 Lb Group Co.Ltd(002601) (002601)
Event:
On February 9, 2022, the company announced that the phase I (25000 tons per year) production line of the artificial graphite cathode material project for lithium-ion batteries with an annual output of 100000 tons invested and constructed by the wholly-owned subsidiary China carbon new materials has been completed. At present, it has entered the trial production stage, which takes only about 6 months from the first announcement of the project.
Key investment points:
The construction of new energy materials has been promoted efficiently, and the graphite negative electrode has entered the trial production stage
As a key cross industry among the three major industries of new energy, new materials and new energy vehicles, the demand side of lithium-ion batteries is gradually expanding. The company took the initiative to seize the development opportunity of lithium battery, made use of ferrous sulfate and other titanium dioxide by-products, and combined with the company’s experience in powder material R & D and production, and actively arranged lithium iron phosphate cathode material and graphite cathode material. The layout of the company in the field of lithium battery materials presents the characteristics of “large chemical industry” and “large-scale”. Since the first announcement on August 13, 2021, the company has planned to build 350000 T / a iron phosphate, 350000 T / a lithium iron phosphate and 300000 t / a graphite cathode materials, with remarkable scale advantages. At the same time, the company efficiently promoted the construction of various projects. On February 9, 2022, the company announced that the phase I (25000 tons per year) production line of the artificial graphite cathode material project with an annual output of 100000 tons was completed and entered the trial production stage. It took only about 6 months from the first announcement of the project, showing high efficiency. With a total investment of 1.5 billion yuan, the project with an annual output of 100000 tons of artificial graphite cathode materials mainly uses needle coke purchased from abroad as raw materials to produce excellent cathode materials through crushing, coating and granulation, graphitization treatment, screening, demagnetization and other processes. The project is constructed in two phases, 25000 tons in phase I and 75000 tons in phase II. According to Baichuan information, the average price of middle-end artificial graphite negative electrode in 2021 is 47300 yuan / ton. When the project reaches full production, it is expected to bring revenue of 4.73 billion yuan.
At the same time, according to the reply of the company in the interactive investor Q & a platform, the phase I of the 200000 t / a iron phosphate project and the phase I of the 200000 t / a lithium iron phosphate project invested and constructed by the company have also successively started the trial run with materials in sections, and the trial production of the whole line is about to begin. With the gradual implementation of the planned capacity, the company will have the production capacity of high value-added lithium iron phosphate and artificial graphite anode, which is conducive to the formation of a more complete industrial system, actively promote the company’s integration into the production and manufacturing supply chain of new energy materials, realize the dual core drive of “titanium dioxide” and “new energy materials”, and enhance the company’s comprehensive competitiveness.
The volume and price of titanium dioxide powder increased at the same time, contributing to the substantial growth of the company’s performance
On December 8, 2021, the company released the performance forecast for 2021. In 2021, it is expected to realize the net profit attributable to the shareholders of the listed company of RMB 4.577 billion-5.722 billion, with a year-on-year increase of 100% – 150%. The company’s performance increased significantly. On the one hand, it benefited from the improvement of the utilization rate of the existing titanium dioxide production capacity, especially the effective release of the company’s chlorination production capacity, which led to the increase of the company’s titanium dioxide sales. On the other hand, the titanium dioxide market is in a business cycle, and the price continues to rise. In 2021, the company issued 9 price increase announcements of titanium dioxide, with a cumulative increase of 6400 yuan / ton for Chinese customers and 1100 dollars / ton for international customers. Meanwhile, on December 14, 2021, the company issued a price adjustment announcement again. From January 1, 2022, the sales price of various models of titanium dioxide of the company will be increased by 1000 yuan / ton for various Chinese customers and 150 dollars / ton for various international customers on the basis of the original price. The continuous rise in the price of main products will promote the steady improvement of the company’s performance.
The production capacity of high-end chlorinated titanium dioxide has been continuously improved and its leading position has been continuously consolidated
As a global leader in titanium dioxide, the company currently has a titanium dioxide production capacity of 1.01 million tons / year, ranking first in Asia and third in the world. In order to further expand the production capacity of titanium dioxide and consolidate its position in the industry, the company announced on January 18, 2022 that it plans to invest 2 billion yuan to build a 200000 t / a titanium dioxide post-treatment project, purchase coarse products from the kiln for fine processing, and improve the production capacity of titanium dioxide. At the same time, the company also arranged a number of chlorinated titanium dioxide capacity expansion projects, including 200000 tons of capacity under construction in Yunnan, 100000 tons of chlorinated titanium dioxide capacity expansion project in Jiaozuo planned in the early stage, and 200000 tons of high-grade chlorinated titanium dioxide project in Panzhihua, Sichuan. Compared with sulfuric acid method, titanium dioxide produced by chlorination method has excellent quality, and the production process has significant advantages in energy conservation and environmental protection. In the long run, it meets the national policy requirements of “carbon peak” and “carbon neutralization”. The implementation of relevant chlorination projects will increase the production capacity of the company’s chlorination titanium dioxide, further adjust the company’s product structure, improve the proportion of the company’s titanium dioxide products in the application of high-end fields, strengthen market competitiveness, improve the market share of products, optimize resource allocation and enhance the company’s ability of circular economy and sustainable development.
The profit forecast and investment rating predict that the net profit attributable to the parent company in 2021, 2022 and 2023 will be 5.351, 6.108 and 7.417 billion yuan respectively, and the EPS will be 2.25, 2.56 and 3.11 yuan / share. The corresponding PE will be 11, 10 and 8 times, giving a “buy” rating.
The implementation of risk warning policies, the construction progress of new production capacity is not up to expectations, the contribution performance of new production capacity is not up to expectations, the price of raw materials fluctuates, the change of environmental protection policies and the economy drops sharply.
