Incident: On May 22, the company issued an announcement. According to the “Jiangsu Huasheng Lithium Battery Materials Co., Ltd. Plan on the Company's initial public offering of shares and stabilizing the stock price within three years after listing on the Science and Technology Innovation Board”, the company will adopt measures to increase the company's stock holdings by directors and senior management who meet the conditions stipulated in the “Stock Price Stability Plan” to stabilize the stock price. There are a total of 7 directors and senior managers who have met the requirements of the “Stock Price Stabilization Plan”.
The company triggered stable stock price conditions, and the increase in executive holdings showed confidence. From April 15, 2024 to May 15, 2024, the closing price of the stock has been lower than the most recent audited net assets per share for 20 consecutive trading days, triggering the starting conditions for stabilizing stock prices. The company's executives plan to increase their holdings. Mr. Shen Jinliang, one of the actual controllers and chairman of the company, and Mr. Shen Ming, one of the actual controllers, director and general manager, plan to increase their total share holdings by no less than 30% of their total after-tax remuneration for the previous year. 20% of total pay.
VC and FEC prices have basically bottomed out, and lithium bis (trifluoromethanesulfonyl) imide (LiTFSI) has made breakthrough progress. According to SMM data, as of May 10, VC and FEC prices were 54,000 yuan/ton and 44,400 yuan/ton respectively. They are already at the bottom of history. The industry is basically at a loss, and the Huayi Stock IPO was terminated, and the expansion of the industry has slowed down. As demand for downstream electrolytes grows, prices are expected to bottom up. At the same time, the company is actively developing new fields of solid state and semi-solid state battery materials. Lithium bistrifluoromethanesulfonimide (LiTFSI) has made breakthrough progress and prepared qualified samples. In terms of lithium battery anode adhesives, it has also sent two types of polyacrylic acid binder products to customers for certification, leading the research and development industry.
Investment advice: The company's net profit for 24-26 is expected to be 0.17/0.93/170 million yuan, up 169.2%/459.6%/83.7% year on year. Corresponding PE is 206x/36.9x/20.1. Considering that the current price of electrolyte additive products is at the bottom of history, it will still take some time for the industry to clear up, and the company's performance will still be under pressure in the short term, giving a “gain” rating.
Risk warning: The price of additive products has fallen, the expansion of new anodes falls short of expectations, and the price of raw materials fluctuates