This week’s view
This week, the power equipment and new energy index rose slightly by 0.38%, of which the photovoltaic index showed a strong performance, up 3.36%. The overall performance of the new energy vehicle sector was weak. There were two lithium battery enterprises in the top five decline of the new power sector. At present, the price of lithium carbonate is rising rapidly, which is not conducive to the improvement of the profits of the downstream industrial chain.
In the past month, the price of lithium carbonate has risen rapidly, from 380000 Yuan / ton to nearly 500000 yuan / ton, mainly due to the imbalance between supply and demand of lithium ore and the slow release of smelting capacity. The market expects that the profits of the downstream industrial chain will be affected. The current plight of new energy vehicles is similar to that of photovoltaic last year. The sharp rise in upstream prices will affect the improvement of downstream profits. At the same time, the rise in prices will also weaken downstream demand and affect the growth rate of the whole industry. According to the model calculation, under the extreme condition that the cost of lithium carbonate is completely borne by car enterprises, the cost of 5 Shenzhen Zhongheng Huafa Co.Ltd(000020) 0000 middle-end models has increased significantly, with an increase of more than 10%. According to the statement of the Ministry of industry and information technology, the state is speeding up the development of China’s lithium resources and cracking down on unfair competition such as hoarding and raising prices. Therefore, with the continuous release of lithium carbonate capacity, the price is expected to be restrained. At the same time, there may be a redistribution process of upstream and downstream profits, and the overall impact on demand is not as great as expected by the market.
In the short term, the market is an extreme reaction to the rise of lithium carbonate price, which will be gradually corrected in the follow-up. The decline of some subdivision leaders is an excellent configuration opportunity. We are still optimistic about the growth rate of the new energy vehicle market throughout the year, and continue to recommend high-profile sectors such as cathode, diaphragm and lithium battery.
Market performance
This week, the Shanghai Composite Index fell 0.11% to close at 344765; CSI 300 fell 1.68% to close at 449643; CITIC power new energy industry index fell 0.38%, outperforming the CSI 300 index by 1.3%. In terms of sub sectors, the new energy vehicle index fell 2.65%, the photovoltaic index rose 3.36% and the wind power index rose 0.16%.
Some company dynamics
On March 3, 2022, Guangzhou Tinci Materials Technology Co.Ltd(002709) ( Guangzhou Tinci Materials Technology Co.Ltd(002709) . SZ) announced that the company reviewed and approved the proposal for additional investment in the project, and agreed to increase the investment in the reconstruction and expansion project of lithium battery materials with an annual output of 150000 tons with self raised funds. The total investment of the changed project was 332 million yuan, including 208.9 million yuan of construction investment and 123.5 million yuan of initial working capital. (official website of the company)
On March 4, 2022, Qinghai Salt Lake Industry Co.Ltd(000792) ( Qinghai Salt Lake Industry Co.Ltd(000792) . SZ) announced that Sinochem Group Co., Ltd. (hereinafter referred to as “Sinochem Group”), the shareholder holding more than 5% of the company, informed the company in the form of notification letter that Sinochem Group reduced 544575 million shares of the company through block trading from December 23, 2021 to March 3, 2022, accounting for 1.002% of the total share capital of the company. (company announcement)
Risk tips
The risk of intensified market competition, repeated epidemic and subsidy policy.
