Events
According to nonferrous metals.com, in February, the price of battery grade lithium carbonate increased by 30.83% to 479500 yuan / ton, the price of industrial grade lithium carbonate increased by 28.53% to 450500 yuan / ton, and the price of lithium hydroxide increased by 52.34% to 407500 yuan / ton. For the recent continuous rise of lithium price, we make the following comments.
Comments
The output of lithium iron phosphate increased greatly, and the price of lithium sector increased rapidly. According to the relevant data in January 2022, the output of power batteries increased significantly, including lithium iron phosphate. In terms of production, the output of ternary battery was 1081530 MWh, a year-on-year increase of + 57.95%, and the output of lithium iron phosphate battery was 1879010 MWh, a year-on-year increase of + 261.79%. In terms of loading volume, the proportion of lithium iron phosphate loading volume increased. The loading volume of ternary batteries was 7299.9 MW, a year-on-year increase of + 35.22%, and the loading volume of lithium iron phosphate batteries was 8873.9 MW, a year-on-year increase of + 172.72%. In terms of market share of loading volume, ternary batteries accounted for + 45.13%, a year-on-year increase of -17.26pct, and lithium iron phosphate accounted for + 54.87%, a year-on-year increase of + 17.26pct. The price of lithium sector also continued to rise driven by the demand of lithium iron phosphate manufacturers. Since the Spring Festival, the price trend of lithium carbonate has continued to be rapid, with an increase of more than 50000 yuan / ton compared with that before the festival in just two weeks.
The wave of global electrification of automobiles is accelerating, and the price of lithium is easy to rise but difficult to fall. The automobile production and sales data reached a new high in January. The monthly production and sales scale exceeded 450000, and the production and sales volume maintained a high-speed growth trend year-on-year. The monthly production and sales volume of new energy vehicles were 452200 and 431400 respectively, with a year-on-year increase of + 133.55% and + 140.79% respectively. In terms of models, the monthly production and sales of new energy passenger vehicles and new energy commercial vehicles increased year-on-year, but the year-on-year growth of production and sales of new energy passenger vehicles was significantly ahead of that of new energy commercial vehicles. It can be seen that after entering 2022, the production and sales of new energy vehicles have continued to be strong since the beginning of the year, and the supply of chip end has reappeared the clue of shortage recently. Superimposed on the shortage of upstream battery grade lithium carbonate, the price of lithium concentrate in China is high and difficult to find. In terms of lithium extraction from Salt Lake, due to the unfinished gas limitation in heating season, the price of lithium will continue to be strong driven by strong supply and demand fundamentals.
The current valuation is reasonable and optimistic about the market value growth space of leading battery enterprises. In the corporate profit segment, the continuous high price of lithium will continue to drive the performance explosion of upstream lithium enterprises, and the midstream transmission, battery factory and vehicle factory will have a certain pressure risk. According to the forecast announcement of Sichuan Yahua Industrial Group Co.Ltd(002497) the annual report, 22q1 is expected to realize a net profit attributable to the parent company of RMB 900-1.2 billion, a year-on-year increase of 1053.7% – 1438.2%, far exceeding the market expectation. Under the rigid competition of electric vehicle demand, the battery factory with cost advantage will occupy the market share and advantage. The profits of the industrial chain will move up, and the release of performance in the first quarter and the persistence of high lithium prices supported by supply and demand will gradually reverse the market cognition. The current valuation has returned to a relatively reasonable position. It is suggested to pay attention to two main investment lines. First, the battery factories with alleviated cost pressure and rebounded gross profit: Contemporary Amperex Technology Co.Limited(300750) , Eve Energy Co.Ltd(300014) , Gotion High-Tech Co.Ltd(002074) , etc; II. Lithium resource companies with high lithium price supported by supply and demand and expected to realize excess profits: Keda Industrial Group Co.Ltd(600499) , Chengxin Lithium Group Co.Ltd(002240) , Tianqi Lithium Corporation(002466) , etc.
Risk warning: the epidemic situation fluctuates beyond expectations; Downstream demand was lower than expected.
