Keda Industrial Group Co.Ltd(600499) involves many business areas, but the most important profit increment in recent two years comes from the investment income of Lanke lithium in 2017.
Last year, the company’s annual net profit was 1.006 billion yuan, of which the investment income confirmed from Lanke lithium, a joint-stock subsidiary, reached 444 million yuan. In the first quarter, driven by the lithium salt price continued to rise and remain high, Keda Industrial Group Co.Ltd(600499) continued to enjoy the above investment dividends.
On the evening of April 6, Keda Industrial Group Co.Ltd(600499) released the performance forecast, which pointed out that the net profit attributable to shareholders of Listed Companies in the first quarter of 2022 is expected to be about 900 million yuan, an increase of about 710 million yuan compared with the same period of last year, with a year-on-year increase of about 371.91%.
There are two reasons for performance growth.
First, the company’s building materials machinery business continued to expand the market, and the output of African building ceramics products increased compared with the same period of last year; Second, due to the rising market price of lithium carbonate products, the net profit of Lanke lithium industry increased significantly compared with the same period of last year, and the investment income recognized by the company also increased significantly compared with the same period of last year.
Keda Industrial Group Co.Ltd(600499) , the second largest shareholder of Lanke lithium.
The company holds 100% equity of Qinghai Keda lithium industry, 37.8% equity of Lanke lithium industry, 53.62% equity of Qinghai Weili and 10.78% equity of Lanke lithium industry.
So far, many lithium salt manufacturers that have released performance forecasts have expected a net profit of more than 900 million yuan in the first quarter. If Sichuan Yahua Industrial Group Co.Ltd(002497) expects the net profit of the first quarter to be 900-1.2 billion yuan, Chengxin Lithium Group Co.Ltd(002240) then the net profit of the current period is expected to be 900-1.1 billion yuan.
It should be noted that Chengxin Lithium Group Co.Ltd(002240) production capacity and output are larger than those of Lanke lithium, with the former producing 40200 tons last year, while the latter producing 22700 tons in the same period.
What is the difference between the production capacity and the profit in the first quarter?
This is mainly affected by the self-sufficiency rate of raw materials, cost, product structure and production capacity.
Let’s start with the cost. This newspaper reported in early April that “lithium extraction from Salt Lake naturally has cost advantages, generally below 50000 yuan / ton. If it is sold at the market price of 500000 yuan, its gross profit margin can reach 90%.”
Chengxin Lithium Group Co.Ltd(002240) , it is an enterprise extracting lithium from ore, and the overall cost of lithium salt production is higher than that of extracting lithium from salt lake.
The second is the self-sufficiency rate of raw materials. Lanke lithium’s production raw materials come from the old brine discharged from Qinghai Salt Lake Industry Co.Ltd(000792) potassium fertilizer, which can achieve 100% self-sufficiency.
Chengxin Lithium Group Co.Ltd(002240) its lithium concentrate output has increased significantly and the supply of raw materials has been stabilized through various channels, but from the recent feedback of the company, “the self-sufficiency rate of raw materials is about 20% at this stage.”
Under the background of the sharp rise in the price of lithium concentrate, the cost of some raw materials extracted from abroad will rise.
Thirdly, the product structure, Chengxin Lithium Group Co.Ltd(002240) previously, the main production capacity was Sichuan Zhiyuan lithium industry, a subsidiary, whose production capacity structure was 25000 tons of lithium carbonate and 15000 tons of lithium hydroxide.
Lanke lithium has a capacity of 30000 tons, all of which are lithium carbonate, not lithium hydroxide. In terms of the price trend in the first quarter, although lithium hydroxide made up for the rise, the overall price is still lower than lithium carbonate.
Finally, production capacity The original capacity of Keda Industrial Group Co.Ltd(600499) participating Lanke lithium was 10000 tons, and the new capacity of 20000 tons in April 2021 was put into trial production in April last year. In the first quarter of this year, it continued to be in the stage of capacity climbing.
At the same time, according to the production capacity and output data of Lanke lithium over the years, the company’s “actual output is greater than production capacity” is also obvious. Similarly, the capacity disadvantage is also shrinking rapidly.
Chengxin Lithium Group Co.Ltd(002240) the new 30000 tons of lithium hydroxide capacity has also been completed and put into operation in January 2022, but the capacity release also needs a certain period.
Under the above multiple factors, the profit scale realized by Lanke lithium industry may not be inferior to that of other ore lithium extraction enterprises without taking advantage of its production capacity and output.
It should be noted that the above lithium salt production enterprises that have issued performance forecasts can only be regarded as second-line enterprises within the industry.
In contrast, the listed companies represented by the “two giants of lithium industry” have larger production capacity, higher resource self-sufficiency rate and significantly lower cost than most companies in the industry.
Therefore, only from the perspective of employment performance elasticity, the profit scale of industry leaders will be higher against the background of the sharp rise in lithium salt prices in the first quarter of this year.
For example Ganfeng Lithium Co.Ltd(002460) , the operating data of the first two months is that the net profit attributable to the shareholders of the listed company is about 1.4 billion yuan, an increase of about 300% year-on-year; After deducting non recurring profits and losses, the net profit attributable to shareholders of listed companies was about 1.8 billion yuan, an increase of about 1000% year-on-year.
Another leader Tianqi Lithium Corporation(002466) , although only the growth data of lithium concentrate and lithium compound income are given, considering the high self-sufficiency of the company’s lithium concentrate and the main lithium carbonate in the existing product structure, the company’s profit in the first quarter of this year will also be very considerable.
