Chengxin Lithium Group Co.Ltd(002240) (002240) disclosed the performance forecast for 2021 on the evening of January 25. The company expects to realize a net profit attributable to the parent company of 830 million yuan to 920 million yuan in 2021, an increase of 2954.31% – 3285.50% over the same period of the previous year. The net profit after deducting non recurring profits and losses was 848 million yuan to 938 million yuan, with a loss of 227 million yuan in the same period of last year. Wind’s consistent expectation shows that the agency expects the net profit attributable to the parent company to be 802 million yuan in 2021, which has exceeded the market expectation. At the same time, it is worth noting that it has also set the best performance of the company since its listing in 2008.
For the substantial growth of performance, the company said that it was mainly due to the rapid development of new energy industry during the reporting period, the strong growth of downstream customers’ demand for lithium salt, and the sharp increase in the production, sales and sales price of lithium salt compared with the same period of last year.
Chengxin Lithium Group Co.Ltd(002240) at present, the self supply rate of lithium mine is limited. The company’s Sichuan yelonggou lithium mine (holding 75% of aoyinuo mining) currently has a lithium concentrate capacity of 70000-80000 tons / year. The company signed 60000 T / A and 120000 T / a underwriting agreements with MT cattlin and avz (Manono) respectively. According to a private placement agency in East China, Chengxin Lithium Group Co.Ltd(002240) only about 10000 tons of lithium salt products come from self-sufficient ore. The performance in 2021 is relatively bright, indicating that the supply chain is doing well.
After previous layout and a series of mergers and acquisitions last year, Chengxin Lithium Group Co.Ltd(002240) has considerable lithium resource reserves. The untapped reserves of Sichuan taiyanghekou lithium Polymetallic Mine (holding 75% of oyno mining) are unknown. Sichuan Murong lithium mine (25.19% equity participation in Huirong mining) has excellent resource endowment and is still under exploration. The sabixing Lithium Tantalum mine (51% holding) project in Zimbabwe has a total of 40 mining warrants. At present, only five mining right areas are explored, with great potential for resource growth. The current capacity of sdla Salt Lake (operation right) in Argentina is 2500 tons of LCE (lithium carbonate equivalent).
While the price of lithium carbonate soared, the expansion of the project of Chengxin Lithium Group Co.Ltd(002240) is also “speeding up”. On January 18, Suining Shengxin held the commissioning ceremony. The lithium hydroxide project with an annual output of 30000 tons was officially ignited and put into production, entering the trial production stage. Suining Shengxin 30000 ton lithium hydroxide project is an important layout of the strategy of Chengxin Lithium Group Co.Ltd(002240) expanding the scale of lithium salt production capacity. The completion and operation of the project has increased the company’s lithium salt production capacity to 70000 tons / year. The Indonesian joint venture plans to invest in the project with an annual output of 50000 tons of lithium hydroxide and 10000 tons of lithium carbonate in morowali Industrial Park. The organization is expected to start construction in early 2021 and put into operation in 2023.
The Research Report of Sinolink Securities Co.Ltd(600109) points out that in the future, with the release of the production capacity of new mines, Chengxin Lithium Group Co.Ltd(002240) the self-sufficiency rate of lithium ore in 2023 will reach about 40%, which is expected to be further improved in the future, the cost will be reduced, and the growth is worth looking forward to.
It is worth noting that behind the record performance, Chengxin Lithium Group Co.Ltd(002240) transformation has been successful. Weihua Co., Ltd., the predecessor of the company, was listed on Shenzhen Stock Exchange in 2008, mainly engaged in wood-based panel and forest planting business. In 2016, the company increased its capital to hold Zhiyuan lithium industry and Wanhong high tech, expanding the field of lithium batteries and rare earth new energy materials; In 2017, the actual controller of the company changed and the major shareholder shengtun group was introduced; From 2018 to 2019, the first production line of Zhiyuan lithium industry was put into operation, and the company acquired oyno mining to accelerate the transformation to a new lithium battery business; In 2020, the company transferred the controlling rights of five wood-based panel business subsidiaries, focused on the development of lithium battery materials business, and changed its name to Chengxin Lithium Group Co.Ltd(002240) in the same year. In 2021, the company continued to sell the controlling rights of its wood-based panel and rare earth business subsidiaries, and all relevant holding subsidiaries have been stripped. As of June 2021, the company’s lithium salt products accounted for 87% of its revenue, and the transformation has been realized.
In December 2021, Chengxin Lithium Group Co.Ltd(002240) moved its registered address from Shenzhen to Chengdu, Sichuan Province, and completed the change of industrial and commercial information. Insiders pointed out that Sichuan Province is rich in lithium resources, and the relocation of the company’s registered place shows strong confidence in the layout of resources.
