The company issued an announcement on February 5 and formulated the “Double Improvement of Quality and Return” action plan (hereinafter referred to as the “Action Plan”). In the action plan, the company has formulated action measures on five major aspects of focusing on the main business of the lithium battery materials industry chain, improving innovation and development capabilities, improving the level of standardized operation, improving trust, and rewarding investors. It is expected to effectively enhance the company's internal value, continue high-quality development, and actively return investors.
Focus on the main business and continuously improve core competitiveness. The company will firmly focus on the development strategy of “integration+globalization”, steadily continue to deepen the integration of the electrolyte upstream industry chain, and at the same time develop businesses such as cathode materials, resource recycling and specialty chemicals horizontally, while maintaining the core competitiveness of the company's products, and steadily improving future profit growth points; in addition, the company is also firmly moving towards the “internationalization” process, and the pace of overseas factory construction will further consolidate its advantages. The company continues to increase investment in R&D. While maintaining its existing technical advantages, the company drives development with innovation, focuses on the development and scientific layout of cutting-edge technology in the industry, and continues to maintain its leading technological advantage. In addition to the market-leading liquid lithium hexafluorophosphate production process, the company also lays out core materials for next-generation lithium battery technology ahead of time, and closely cooperates with customers to develop next-generation lithium battery electrolyte materials and solid-state lithium battery materials such as sodium-ion batteries, 4680 large cylinders, high nickel, high pressure, etc., to grasp the most forward-looking academic trends in green chemistry.
The company continues to use methods such as share repurchases and cash dividends to repay investors. The company attaches great importance to reasonable return on investment for investors and has clearly formulated the “Shareholder Dividend Return Plan for the Next Three Years (2023 to 2025)”. The cumulative cash dividend over the past three years has exceeded 1.7 billion yuan, and the annual cash dividend ratio exceeds 20% of the net profit attributable to shareholders of listed companies. From 2022 to 2023, the company used a total of 386.64 million yuan of its own capital to repurchase 7.901 million shares of the company's shares. In the long run, with the gradual improvement of the company's business layout, the company will continue to raise the level of shareholder return, implement a “long-term, stable and sustainable” shareholder value return mechanism, and continue to enhance investors' sense of gain.
Profit forecast and investment rating: Considering the decline in the company's product prices, we lowered the company's 2023-2025 net profit forecast to 19.23/15.62/2,069 billion yuan (the original forecast was 22.28/26.16/3.87 billion yuan), -66%/-19%/+32%, corresponding PE was 17x/20x/15x, considering that the company is at the bottom of the cycle, and future price recovery is more flexible, maintaining the “buy” rating.
Risk warning: Electric vehicle sales fall short of expectations, profit levels fall short of expectations