\u3000\u3000 Sunresin New Materials Co.Ltd Xi'An(300487) (300487)
Event: the company announced that it had recently received the contract signing notice from Jinhai lithium industry (Qinghai) Co., Ltd. on the "10000 ton lithium carbonate EPC procurement project of Jinhai lithium industry (Qinghai)". The project is located in Dachaidan Industrial Zone, circular economy Experimental Zone, Haixi Prefecture, Qinghai Province. The tentative total contract price is 456112400 yuan. The construction and installation is expected to be completed on August 31, 2022, The whole system was put into trial production on September 30 and put into operation on October 30.
Comments:
The company's re signing the large order for lithium extraction from Salt Lake is expected to significantly increase its performance in 22 years: the 10000 ton lithium carbonate EPC purchase order is a further expansion of the company's lithium extraction business from salt lake. On the one hand, the salt lake brine of the project has good quality and less impurities. It is used for the direct production of battery grade lithium carbonate, which will greatly improve the yield of the production line and improve the product quality while reducing the cost; On the other hand, the company cooperates with Jinhai lithium, a joint venture subsidiary of Eve Energy Co.Ltd(300014) , and will directly enter the industrial chain of mainstream battery manufacturers for downstream lithium carbonate applications. The implementation of the project is an important demonstration of direct extraction of brine and rapid formation of lithium carbonate output. The estimated contract amount of the project is RMB 456 million, accounting for about 49.4% of the total operating revenue in 2020. If the order is successfully signed, the relevant projects will be completed and put into operation in 22 years, which is expected to significantly increase the company's performance in 22 years.
The trinity of technology accumulation has achieved the company's important technical position in the new energy lithium battery industry chain: after more than 10 years of intensive cultivation in the field of lithium extraction from salt lakes, the company has formed a lithium related resource grid transversely penetrating different salt lake resources and lithium extraction and purification from different sources Vertical material + process + system device, product combination of construction and operation of the whole line, and Trinity technology accumulation of development and application of brine with different grades and contents. It is estimated that after the signing of the project, the cumulative contract amount of the company in the field of lithium extraction from Salt Lake will reach more than 1.6 billion yuan. At present, the owners of large-scale industrialization projects completed and being promoted by the company include Eve Energy Co.Ltd(300014) , Minmetals Salt Lake, Zanger mining, Jintai lithium industry, as well as mainstream lithium resource suppliers at home and abroad such as Byd Company Limited(002594) and sqm under pilot test. The market development results of vertical and horizontal interweaving have achieved the technical position of the company in the lithium related chain link of the new energy industry.
The demand for terminal new energy is strong, and the lithium extraction business in Salt Lake is expected to increase significantly: the new energy vehicle industry chain is gradually mature, benefiting from the rapid development of the new energy vehicle industry, China's lithium carbonate demand is strong, but China's lithium resources are scarce, the market supply is in short supply, and most of them depend on imports. In this context, the price of lithium carbonate is rising. According to the data of Baichuan Yingfu, China's lithium carbonate capacity increased from 210000 tons in 2017 to 470000 tons in 2021, with an average annual growth of 30%. By the end of 2021, the price of battery grade lithium carbonate in China was 287000 yuan / ton, an increase of 419% over the price at the end of 20. With the successful implementation of several salt lake lithium extraction projects of the company and the continuous improvement of the industry prosperity, it is expected that the order volume of salt lake lithium extraction business will significantly increase the company's performance in the future.
Profit forecast, valuation and rating: considering that the order has not been formally signed, we maintain the profit forecast. It is estimated that the net profit attributable to the parent company from 2021 to 2023 will be 300 / 385 / 514 million yuan and EPS will be 1.37/1.75/2.34 yuan respectively, maintaining the "overweight" rating.
Risk warning: there is still uncertainty in contract signing and contract terms; The production progress is less than expected.
