Divest the cement business and focus on lithium industry + environmental protection. 2021 so far the company has stripped off the cement business, acquired BABA lithium source into the lithium salt business, lithium resources, production capacity gradually landed.
The electrochemical deembedding process of Lxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxqiancuo salt lake electrochemical deintercalation process is put into production, and it is planned to build 8000-100 million tons this year Lxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx In August 22, 2000 tons of lithium carbonate was fully put into production, and it is planned to build a capacity of 8000-10000 tons of lithium carbonate this year. At present, the electrochemical de-intercalation method adopted by the company in LXXXVI Qiancuo Salt Lake has the advantages of high yield, low cost, environmental protection and modular construction, and has technical advantages over other salt lake lithium extraction technologies.
Close ties with Argentina, the rapid landing of resources. On July 15, 2022, the company successfully purchased the Argentine Salt Lake Laguna Caro project for US $27 million. The average grade of Li is 744mg/L. The company's website reveals that the project resources are 50-1 million tons LCE, and the expected annual production capacity is 5000-20000 tons LCE; Gold Yuan subsidiary Jin Hengwang and HANAQ ARGENTINA S.A., HANCHA S.A. The exclusive full Adjustment Agreement of the Mina Payo Salvaci ó n project was signed. It is optimistic about the application of electrochemical de-embedding method in Argentina project.
A number of cooperation framework agreements have landed, and the strategy of the second take-off of new energy materials has been steadily advanced. Since the change of chairman from Zhao Hui to Xu Gang, the company has established a second take-off strategy, focusing on the upstream layout of salt lake production capacity of new energy materials, the acquisition of salt lake resources at home and abroad, the construction of lithium battery recycling bases, and the divestiture of cement business. and in turn landed a number of cooperation framework agreements, Tongchen Yu Mining, Hengda Mining, China Science Suhua, Jintai Industry and Trade and other enterprises signed cooperation framework agreements on salt lake resources. Sign cooperation framework agreement with lithium industry and other enterprises in lithium salt production line, and establish subsidiary Jin Hengwang with Xinwangda and Chuanheng shares.
The demand for lithium carbonate is strong, the price of lithium carbonate is expected to be maintained at repeated auctions in Australia, and the winter production reduction in Qinghai Salt Lake affects the marginal supply. We estimate that the total global demand for lithium carbonate will reach 1.8856 million tons by 25 years, with a compound growth rate of 38.73% from 2021 to 2025. The latest auction price of Australian lithium concentrate reached a new high of US $6988 / ton, corresponding to the cost of lithium carbonate of about 510,000 yuan / ton. In addition, the production reduction of Qinghai Salt Lake in winter will have an impact on the marginal supply. At present, the production capacity of Qinghai Salt Lake has reached 117000 tons, and the production reduction has a certain impact on the national lithium carbonate supply.
Investment suggestion: the income of the company in 22-24 is estimated to be 73.85, 98.86, 10.717 billion yuan respectively, and the net profit of return to the mother is 4.09 billion yuan, corresponding to PE30.37/6.56/6.01 times. The company's PE in 23-24 is lower than the average PE11.47/8.44 of comparable companies, and as the Argentine project goes into production in the future, it will further increase the company's profits, giving a "buy" rating for the first time.
Risk hint: the company's lithium carbonate capacity falls short of expectations; the price of lithium carbonate drops more than expected; the company's cooperation agreement is at risk of being breached.