\u3000\u3 China Vanke Co.Ltd(000002) 240 Chengxin Lithium Group Co.Ltd(002240) )
Events: (1) the company released the 2021 annual report. In 2021, the operating revenue was 2.934 billion yuan, a year-on-year increase of 63.88%, of which 2021q4 operating revenue was 1.075 billion yuan, a year-on-year increase of 244.93% and a month on month increase of 48.03%. In 2021, the net profit attributable to the parent company was 851 million yuan, with a year-on-year increase of 303029%, of which the net profit attributable to the parent company in 2021q4 was 312 million yuan, with a year-on-year increase of 143653% and a month on month increase of 26.18%. In 2021, the net profit not attributable to the parent company was RMB 862 million, a year-on-year increase of 479.05%, of which the net profit not attributable to the parent company was RMB 350 million in 2021q4, a year-on-year increase of 124463% and a month on month increase of 41.65%. (2) The company released the performance forecast of Q1 in 2021. The net profit attributable to the parent company in Q1 in 2021 was RMB 900-1.1 billion, with a year-on-year increase of 765.24% - 957.52% and a month-on-month increase of 188.2% - 252.2%; In 2021, the net profit not attributable to the parent company deducted from Q1 was 8951095 million yuan, with a year-on-year increase of 806.35% - 100889% and a month on month increase of 155.79% - 212.95%. The performance of Q1 in 2021 increased significantly compared with the month on month or the volume and price of lithium salt increased at the same time.
The development direction of lithium salt industry is clear. In 2021, the business income of lithium products was 2.785 billion yuan, a year-on-year increase of + 301.46%, accounting for 94.9% of the total revenue; The gross profit margin was 47.78%, contributing 1.331 billion yuan, a year-on-year increase of 1.427 billion yuan, accounting for 97.71%. The company will focus on the development of lithium new energy materials and continue to peel off the rare earth and MDF businesses. It is announced that it will continue to peel off the forest business in the future.
The production and sales increased greatly, and the sales price increased significantly. (1) In terms of output: 1) in 2021, the effective capacity of lithium salt is 40000 tons (25000 tons of lithium carbonate + 15000 tons of lithium hydroxide), and the output is about 40290 tons, a year-on-year increase of + 108.9%. The capacity of lithium salt has reached the production capacity. 2) In 2021, the output of lithium concentrate of yelonggou lithium mine was 41800 tons, the internal use was 37400 tons (converted into 4700 tons of LCE), and the existing concentrate inventory was 4400 tons. (2) In terms of sales volume, the sales volume of lithium salt in 2021 was 42096 tons, and the excess output was mainly used. The inventory in 2020 was 1806.1 tons, and there was still 1441.5 tons in 2021. (3) In terms of selling price, the average price of H1 in 2021 is 60000 yuan / ton (78600 yuan / ton for SMM), and the average price of 2021h2 is 117000 yuan / ton (156000 yuan / ton for SMM).
The production capacity has increased rapidly, and the rhythm of large-scale production in the future is good. The company has 25000 tons of lithium carbonate capacity and 45000 tons of lithium hydroxide capacity (Suining Shengxin 30000 tons of lithium hydroxide capacity has been completed and put into operation in January 2022). In addition, Indonesia Shengtuo 10000 tons of lithium carbonate capacity and 50000 tons of lithium hydroxide capacity are under construction. It is expected to be completed in 2023. The company holds 65% equity. At that time, the company will have about 110000 tons of equity lithium salt capacity. In addition, Shengwei lithium industry plans to have a production capacity of 1000 tons. The phase I 600 ton metal lithium project has completed a production capacity of 400 tons, and the remaining production capacity is actively under construction.
Maxmind and Murong lithium projects have been continuously promoted, and their own resources have increased significantly.
The company's equity resources are about 718900 tons of LCE:
1) the company holds 75% interest in yelonggou lithium mine. The Li2O grade of the mine is 1.3%, the resource is 275600 tons of LCE, the concentrate capacity is 75000 tons / year, or there is an expectation of increasing reserves.
2) the company holds 25.2% interest in Murong lithium mine, with Li2O grade of 1.63% and resource volume of 1.5896 million tons of LCE.
3) the company holds 51% equity of maxmindand its sabixing Lithium Tantalum mine has a Li2O grade of 1.98% and a resource of 218800 tons of LCE.
4) the company holds 50% of the operation right of Argentina sdla project, and the annual production capacity of the project is 25000 tons of lithium carbonate equivalent.
According to the announcement of the company, the current sources of lithium concentrate of the company include:
1) the annual production scale of its own longgou raw ore is 405000 tons, which is converted into about 75000 tons of lithium concentrate. The lithium concentrate can be used by Zhiyuan lithium industry for lithium salt production.
2) the designed raw ore production scale of sabixing Lithium Tantalum mine project is 900000 tons / year, equivalent to about 200000 tons of lithium concentrate. It is expected to be completed and put into operation by the end of 2022.
3) from 2021 to 2023, it will underwrite 60000 tons of lithium concentrate of Yinhe lithium industry every year.
4) three years (extendable) since avz is put into operation, 160000 tons (+ / - 12.5%) of lithium concentrate will be underwritten every year.
Investment suggestion: we expect the company's operating revenue to be RMB 8308 million, RMB 13161 million and RMB 18572 million respectively from 2022 to 2024, and its net profit to be RMB 3.089 billion, RMB 4.584 billion and RMB 5.927 billion respectively, corresponding to EPS of RMB 3.57, 5.3 and 6.85 yuan / share respectively. At present, the corresponding PE share price is 15.2, 10.3 and 7.9 times. Maintain the "overweight-a" rating, and the six-month target price is 61 yuan / share.
Risk tip: lithium price is lower than expected, demand is lower than expected, and project progress is lower than expected
