2021-10-27 Guoxin Securities Co., Ltd. Liu Mengluan, Yang Yaohong conducted research on Ganfeng Lithium and released a research report "comment on the third quarter report of 2021: 21Q3 net profit is close to the forecast upper limit, resource-side layout is worth looking forward to", this report gives a buy rating to Ganfeng Lithium, the current stock price is 172.84 yuan.
Ganfeng Lithium (002460)
The net profit of 21Q3 is close to the forecast limit, and the volume and price of lithium salt products rise to boost profits.
In the first three quarters, the company achieved revenue of 7.054 billion yuan, + 81.19% compared with the same period last year; realized net profit of 2.473 billion yuan, + 648.24% compared with the same period last year, which was within the range of 20.83-2.573 billion yuan of forecast; and realized deduction of non-net profit of 1.428 billion yuan, + 435.58% of the same period last year. The company's 21Q3 realized revenue of 2.989 billion yuan, year-on-year + 98.50%, month-on-month + 21.65%; realized home net profit of 1.056 billion yuan, year-on-year + 506.99%, month-on-month + 12.29%, in line with the forecast range of 9.15-1.092 billion yuan; realized deduction of non-net profit of 593 million yuan, year-on-year + 538.50%, month-on-month + 9.41%. The difference between the company's net return to the parent and the deducted non-net profit mainly comes from the income from holding Pilbara shares. Pilbara's share price in 21Q3 rose 41.38%, corresponding to the company's fair value change income of about 500 million, which is in line with the actual data. The substantial increase in the company's profits is mainly due to: (1) the price of lithium salt has risen by leaps and bounds; (2) the annual production capacity of 50,000 tons of lithium hydroxide in the third phase of Mahon is basically in a state of full production and sales. Lithium salt production and sales have increased significantly compared with the same period last year; (3) the lithium industry is in the upward cycle and can enjoy the premium generated by low-cost raw material inventory.
The company takes the lead in realizing large-scale capital expenditure, and the resource-side layout is worth looking forward to.
The company increases its capital expenditure, among which the layout on the raw material side is particularly noteworthy: 1 the first phase of Argentina's Cauchari Salt Lake project is expected to start production of 40, 000 tons of battery-grade lithium carbonate per year in mid-2022, and the second phase of expansion feasibility study has been launched; 2 Mariana Salt Lake in Argentina has been approved by the local government to start the construction of a 20, 000-ton lithium chloride plant, and the company's shareholding ratio has reached 100%. (3) the Mexican lithium clay project, which has the advantages of extracting lithium from both ore and salt lake, is in the process of project construction; (4) it is proposed to acquire 49% of Minmetals Salt Lake and indirectly own the interest in the Chaidamu-Liping Salt Lake project in Qinghai Province; (5) it is proposed to acquire 50% of SPV in the Netherlands, and indirectly owns the interest in the spodumene project of Goulamina in Mali. 6. It is proposed to acquire a 15.48% stake in Jintai Potash, which is mainly engaged in mineral development in Barun Mahai.
Risk hint: the construction progress of the project is not up to expectations, and the production and sales of lithium salt products are not up to expectations.
Investment advice: maintain a "buy" rating.
It is estimated that the company's revenue from 2021 to 2023 will be 123.82 yuan 223.10 / 27.576 billion yuan respectively, a year-on-year growth rate of 124.2%, 80.2%, 23.6%, 38.44%, 53.97% and 7.417 billion yuan, respectively, with a year-on-year growth rate of 275.2%, 40.4% and 37.4%, respectively, and the diluted EPS is 2.67cusp 3.75x5.16 yuan, and the current stock price corresponds to PE 654633X. Considering that the company is the highest quality lithium company in A shares, production capacity is expanding against the trend at the bottom of the industry, and the global new energy vehicle boom is expected to continue to improve in the future, maintaining a "buy" rating.
A total of 16 agencies have given ratings in the last 90 days, including 9 buy ratings and 7 overweight ratings; the average institutional target price in the past 90 days is 234.43; according to the Securities Star valuation analysis tool, Ganfeng Lithium (002460) has a good company rating of 4 stars, a good price rating of 1.5 stars and a comprehensive valuation rating of 2.5 stars.