Event: on June 14, 2022, the company announced that the Tibet Natural Resources Department confirmed the transfer income, payment amount and payment method of the Zabuye Salt Lake mining right, and signed the income payment contract with Zabuye, Tibet on June 13. The total transfer income will be 2.91 billion yuan, with the first payment of 580 million yuan; the rest will be paid year by year for 20 years (from 2023 to 2042), with an annual payment of 120 million yuan before June 30 of each year.
The proceeds from the transfer of mining rights in Zabuye Salt Lake have been confirmed and the preliminary work for equity optimization has been prepared. The company announced on January 4 that it had received a new reserve verification report. As of November 30, 2021, the Li2CO3 of the main mineral identified within the mining certificate of the Zabuye Salt Lake deposit was 1.79 million tons of retained resources, of which 1.64 million tons were controlled resources, 150000 tons of inferred resources and 550000 tons of credible reserves. The calculation of this resource verification report is mainly based on the original report benchmark deducting the development volume in recent years, and no further substantial additional reserves and prospecting work has been carried out, which is more beneficial to the minority shareholders of listed companies. After the confirmation of the transfer income, the company will immediately carry out equity optimization work according to the evaluation report, and it is expected that with the completion of equity adjustment, the project will enter the substantive development stage in 2022, especially the reserve-increasing potential of some veins of solid ore should be paid full attention to.
From 2021 to 2025, the total production capacity of lithium salt is nearly 40,000 tons of LCE, with a total planned investment of 6 billion yuan. 1) add more than 30,000 tons of LCE lithium salt project: among them, 2 billion plans to build a 10,000 ton battery-grade lithium carbonate production line (9600 tons of electric carbon + 2400 tons of industrial carbon) in 2021-2023, and plan to invest 2 billion in 2023-2025 to build a 10,000-ton lithium hydroxide + the second 10,000-ton battery-grade lithium carbonate project. The company's total lithium production capacity is nearly 40,000 tons (Zabuye II 12000 tons + new planning 20 thousand tons + lithium concentrate 5400 tons (equivalent to LCE)). The matching energy supply project of the United Nations household appliances is carried out at the same time. 2) the production capacity of chromite is planned to increase to 200000 tons by 2023.
In May, the production and sales of new energy vehicles exceeded expectations, with a month-on-month increase of 49.4% and 49.6% compared with the previous month, returning to rapid growth. With the stimulation of the policy of accelerating the resumption of production in the post-epidemic automobile industry chain, it is expected to hedge against the impact of the epidemic in Shanghai in April, the bottom of production and sales of new energy vehicles for the whole year may have been established, and the recovery growth will be welcomed in the second half of the year. In June, mainstream battery factories accelerated to increase the battery scheduling target, total cycle ratio + 10.3%/+5.1Gwh, including LFP ring ratio + 18.6%/+3.85Gwh, ternary ring ratio + 4.3%/+1.25Gwh. Manufacturers of positive materials have a positive intention to inquire about goods, and most of them take goods for rigid demand. Lithium carbonate has been going to the warehouse for three consecutive weeks, and the price may remain high.
Investment suggestion: the company plans to expand production steadily, and under the background of high lithium price, future profits are expected to further increase. It is estimated that the return net profit of the company from 2022 to 2024 is 9, 17 and 2.4 billion yuan, and the corresponding PE is 27, 19 and 14 respectively. Maintain the company's "buy" rating.
Risk hints: the risk of price fluctuation of lithium salt products; the risk of epidemic situation affecting terminal consumer demand; and the risk that the second phase of the project is not as expected when it is landed and put into production.