This week’s view
This week, the power equipment and new energy index fell by 3.77%, and the sub sectors fell almost across the board. We firmly believe that the three sectors in the new energy field logically exceed market expectations and may resonate upward. The short-term decline is the process of switching from the bottom of the policy to the bottom of the market, which is a good opportunity for the allocation of the whole new energy sector.
In 2021, the cumulative installed capacity of China Shipbuilding Industry Group Power Co.Ltd(600482) batteries exceeded 154gw, with a year-on-year increase of more than 142%, of which lithium iron phosphate batteries accounted for 51.7%, with a year-on-year increase of more than 220%. From January to February 2022, the cumulative installed capacity of lithium iron phosphate batteries was 38.9gw, with a year-on-year increase of 309%, accounting for 63%. The data shows that lithium iron phosphate batteries maintain high-speed growth and the overall market share continues to improve. We believe that the supply and demand of lithium iron phosphate sector may continue to be tight, and there are layout opportunities upstream and downstream of the industrial chain, based on the following three logic:
1) from the second half of 2021, the price of upstream raw materials of lithium battery has continued to rise. Under the pressure of cost side and the influence of subsidy policy, lithium iron phosphate battery with relatively low price is favored by the market, and the installed capacity accounts for more than ternary battery. This trend will not change in the short term.
2) the price of lithium iron phosphate cathode reflects the current supply and demand pattern. As of last week, the price of lithium iron phosphate has exceeded 165000 yuan / ton, with an annual increase of 284%. The sharply rising price has a great positive impact on the profits of the company in the iron phosphate industrial chain.
3) the total production expansion plan of the enterprise is large, but the actual implementation will be greatly reduced due to the influence of energy consumption, environment, capital and other factors, but the demand growth is sustained and stable, and the tense relationship between supply and demand may be maintained until 2023.
Overall, benefiting from the rapid growth of lithium battery demand, the supply and demand pattern of lithium iron phosphate continues to be tight, and there are layout opportunities for iron phosphate and lithium iron phosphate cathode material companies in the industrial chain. It is suggested to pay attention to Yunnan Yuntianhua Co.Ltd(600096) , Shenzhen Dynanonic Co.Ltd(300769) , etc.
Some company dynamics
On the evening of March 25, 2022, Ming Yang Smart Energy Group Limited(601615) announced that due to the capital needs of the partners of the holding platform, the shareholder Gongqing City Lianyun investment partnership plans to reduce its holdings of no more than 183099 million shares by means of centralized bidding and block trading within 6 months after 15 trading days from the date of disclosure of this announcement. (company announcement)
On the evening of March 21, 2022, Guangzhou Tinci Materials Technology Co.Ltd(002709) disclosed the annual report of 2021. During the reporting period, the company achieved an operating revenue of 11.091 billion yuan, a year-on-year increase of 169.26%; The net profit was 2.208 billion yuan, a year-on-year increase of 314.42%; The basic earnings per share is 2.35 yuan. The company plans to increase 10 shares for every 10 shares to all shareholders and distribute a cash dividend of 5 yuan (including tax). (company announcement)
Risk tips
The risk of intensified market competition, repeated epidemic and subsidy policy.
