occurrences
The company released its 2023 three-quarter report. 2023Q1-Q3 achieved operating income of 5.05 billion yuan, a year-on-year decrease of 8.81%; net profit of 2,070 billion yuan, an increase of 0.92% over the previous year; net profit after deduction of net profit of 2,025 billion yuan, an increase of 1.32% over the previous year.
reviews
Overseas lithium mines have returned to China one after another, and Q3 performance increased month-on-month. 2023Q3 achieved revenue of 1,404 billion yuan, a year-on-year decrease of 32.44%, a year-on-month decrease of 8.23%, net profit of 568 million yuan, a year-on-year decrease of 22.08%, a year-on-year increase of 39.64%, and net profit of 535 million yuan after deducting non-return net profit of 535 million yuan, a year-on-year decrease of 26.21%, and an increase of 38.29% over the previous year. In July 2023, the “Bikita 2 million tons/year (lithium penetrating feldspar) renovation and expansion project and the 2 million tons/year (lithium pyroxene) construction project” were successively completed and officially put into trial production. The self-sufficiency rate of the lithium mine reached 100%, and the company's profitability increased dramatically.
Bikita has begun shipping spodumene, and costs are expected to drop further. On September 7, 2023, local time in Zimbabwe, the first batch of 10,000 tons of spodumene concentrate powder from the Zimbabwean Bikita mine to which the company belongs began to be shipped back to China to supply the raw material requirements for the 35,000-ton battery-grade lithium hydroxide and battery-grade lithium carbonate production line currently being built by the company, marking that the Bikita mine's spodumene production line has been able to supply spodumene concentrate powder steadily. In addition to this, the Bikita mine's lithium-permeable feldspar transformation and expansion production line continues to be produced, and the lithium-permeable feldspar concentrate produced continues to be transported to the country.
With 60,000 tons in the second half of the year and 100,000 tons in the forward period, growth is still excellent. The company currently has an annual production capacity of 25,000 tons of battery-grade lithium carbonate/lithium hydroxide, and is also building a new high-purity lithium salt project with an annual output of 35,000 tons. It is expected to be completed and put into operation in the fourth quarter of 2023. At that time, the company will have a total production capacity of 60,000 tons/year of battery-grade lithium carbonate/lithium hydroxide. At the same time, the company will continue to increase the self-sufficiency rate of lithium ore resources, continue to expand the production capacity of new energy raw materials, and gradually achieve 100,000 tons of high-purity lithium salt production capacity and complete self-sufficiency in mineral resources.
The volume and price of the cesium rubidium salt sector have risen sharply, and revenue and profit have continued to grow. Cesium has excellent photoelectric conversion efficiency. Cesium products are widely used in fine chemicals, oil and gas drilling, aerospace, optoelectronics, medicine, 5G communications, time-frequency industry, fireproof materials and other fields. The cesium formate business is based on the original European North Sea region, making full use of its environmentally friendly and efficient advantages to actively develop business in the Indian Ocean region, Malaysian waters, the Gulf of Thailand region, and China's waters.
Profit forecasting
The company's net profit for 2023-2025 is estimated to be 26.38/38.85/4.251 billion yuan respectively, corresponding to EPS of 3.66/4.84/5.91 yuan, corresponding to PE9.88/7.48/6.13 times, maintaining the “buy” rating.
Risk warning:
The price of lithium salt fluctuates greatly; the company's production capacity construction falls short of expectations; demand for new energy vehicles falls short of expectations; overseas political risks.