Main points of investment
Deep ploughing lithium battery materials in the field of technical service providers. The company was originally engaged in the traditional energy and chemical industry, the acquisition of Nanda Zijin Lithium Power (now Baili Lithium) active transformation and continuous layout of lithium materials industry. Based on the intelligent equipment manufacturing of lithium battery production line, the company actively expands the general contracting business of lithium battery positive material intelligent production line project, and gradually forms the whole process service of lithium battery positive and negative material intelligent production line. Benefiting from the outbreak of downstream demand, the company's revenue from lithium battery materials has grown rapidly, reaching 561 million yuan, 688 million yuan and 1.195 billion yuan respectively from 2018 to 2020.
High nickel ternary development direction is clear, driving cathode manufacturers to accelerate production expansion. The cathode material system of power lithium electricity is various, but the overall development direction is high energy density and low cost. In theory, high nickel ternary can give consideration to both to achieve higher performance-to-price ratio. The deepening of the electrification trend and the improvement of high nickel permeability will drive the demand for high nickel ternary cathode materials. It is estimated that the demand for NCM811/NCA in 20205 will exceed 1 million tons. In terms of competition, the overall market concentration of ternary positive electrodes has increased, with CR5 reaching 49% in the first half of 2021, while high-nickel ternary players have increased. In addition to Rong Bai, Tianjin Bamo, Beitre and Dangsheng technology market share has also increased significantly. Cathode manufacturers plan to greatly expand their high nickel production capacity, which is expected to increase by more than 200000 tons in 2021 and 2022.
The full-process service provider of scarce cathode materials benefits from the outburst of downstream demand. The deep ploughing equipment and design link of Baili Lithium Power has successively participated in the construction of the first negative electrode production line in China and the negative electrode production line of 1500 tons in Ruixiang, Hunan Province in 1999. at present, more than 100 production lines have been built all over the country. After the merger and acquisition, it has the ability of EPC to realize the equipment production service and integrate the company's technological advantages after being acquired. The company's customer structure is high-quality, such as Dangsheng Technology, Beitri, Sichuan New Lithium, Hunan Shanshan, Chengdu Bamo, Ningde era and so on. Downstream customers rapidly expand production, with newly signed lithium electricity orders exceeding 1.5 billion yuan and on-hand orders exceeding 2 billion yuan in the first half of 2021. In recent years, the company has signed EPC order projects with Dangsheng Technology, Sichuan Xinlixiang, Hunan Shanshan and other newly signed projects, and the single contract amount has increased significantly compared with the pure equipment model.
Investment suggestion
In 2021-23, the company is expected to achieve revenue of 2.14 billion yuan / 3.39 billion yuan / 4.51 billion yuan, net profit of 160 million yuan / 320 million yuan / 460 million yuan, corresponding to the price-to-earnings ratio of 53.5X/26.3X/18.4X. The company is the domestic scarce lithium battery cathode materials full-process service provider, the outbreak of new energy vehicle demand, high nickel permeability continues to increase, is expected to usher in rapid growth, the first time to cover the "buy" rating.
Risk hint
The iterations of products and technologies are not as expected, the expansion of downstream customers is not as expected, and the recovery of accounts receivable is not as expected.