\u3000\u3 China Vanke Co.Ltd(000002) 466 Tianqi Lithium Corporation(002466) )
Events
The company released its 2021 annual report and the first quarterly report of 2022 on the evening of April 29. In 2021, the company achieved a revenue of 7.663 billion yuan, a year-on-year increase of 136.56%; The net profit attributable to the parent company was 2.079 billion yuan, reversing losses year-on-year. In the first quarter of 2022, the company achieved a revenue of 5.257 billion yuan, a year-on-year increase of 481.41%; The net profit attributable to the parent company was 3.328 billion yuan, reversing losses year-on-year; EPS is 2.25 yuan.
Commentary
The performance flexibility is prominent, and the debt problem is gradually alleviated. Q1 company’s net profit attributable to parent company increased by 114.85% on a ring basis; The comprehensive gross profit margin was 85.28%, with a ring increase of 14.43 PCTs, and the profitability was greatly improved. The average price of Q1 lithium carbonate was 423000 yuan / ton, with a ring increase of 101%. The company’s performance showed flexibility. In 21 years, talison’s concentrate output was 954000 tons, an increase of 64% at the same time; The lithium salt output of the company was 43700 tons, an increase of 15% at the same time. In the 21st year, the company confirmed that the investment income of sqm was 760 million yuan and that of Q1 was about 500 million yuan. The company’s H-share listing and financing have been steadily promoted, and the impact of subsequent debt, options and other factors on performance will be weakened.
Talison’s capacity continues to expand, and it is planned to reach 2.1 million tons / year in 25 years. The global cost of greenbushes mine is the lowest, and the 20-year cost is only $250 / ton. After the tailings pond project was put into operation in March, the current production capacity of talison lithium concentrate is 1.62 million tons / year, which is expected to be close to full production in 22 years. Talison’s phase III expansion project is expected to be put into operation in 25 years, and the concentrate capacity is expected to reach 2.1 million tons / year. The phase IV expansion project is expected to be started in 25 years and put into operation in 27 years. In addition, the company will restart the mining of Cuola lithium mine in Yajiang, Sichuan as soon as possible to strengthen the resource guarantee capacity.
Quinana phase I trial production, and the Anju project is gradually started and restored. At present, the company’s lithium salt production capacity is 44800 tons / year, and 24000 tons of lithium hydroxide in quinana phase I has entered the trial production stage. Supply agreements have been signed with SK, LG Chemical, northvolt, etc; Suining Anju 20000 ton battery grade lithium carbonate project is gradually resuming its construction rhythm and is expected to be put into operation and commissioning in the second half of the year; The long-term planned capacity of lithium salt of the company will reach 114800 tons / year. In addition, the lithium salt production capacity of the joint-stock company sqm is planned to reach 210000 tons in 22 years and 250000 tons in 23 years. As the second largest shareholder of sqm, the company is expected to obtain rich investment income.
Profit forecast & investment suggestions
It is expected that the price of lithium will remain high, and the net profit attributable to the parent company in 22-23 years will be increased by 79% and 67% respectively. The net profit attributable to the parent company in 22-24 years is expected to be 15.241 billion yuan, 15.957 billion yuan and 16.099 billion yuan respectively, corresponding to EPS of 10.32 yuan, 10.80 yuan and 10.90 yuan respectively, and corresponding PE of 7.4 times, 7.1 times and 7.0 times respectively, maintaining the “buy” rating.
Risk tips
The uncertainty of lithium salt price trend in the later stage increases; The growth rate of lithium salt demand was lower than expected.
