The company released its semi-annual report: achieved revenue of 9.589 billion yuan in the first half of the year, or -47.16%; realized net profit attributable to mother -0.76 billion yuan, -113% year-on-year; realized net profit deducted from non-mother -0.16 billion yuan, or -103.90% year-on-year.

The company's net profit loss in the first half of the year was mainly due to a significant year-on-year decline in lithium salt prices. The average price of battery-grade lithium carbonate in China was about 0.1036 million/ton in the first half of the year, the average price of Q1/Q2 was about 0.1015/0.1054 million/ton, the average price of domestic battery-grade lithium hydroxide in the first half of the year was about 0.0937 million/ton, and the average price for Q1/Q2 was about 0.0895/0.0975 million/ton respectively.

In terms of financial data: ① As of the first half of 2024, the company's balance ratio was 46.32%, up 3.37 percentage points from the end of 2023; active currency capital was about 8.355 billion yuan, -24.83%; on-hand inventory was about 8.121 billion yuan, or -28.50%; ② In the first half of this year, the company confirmed investment income of about 0.382 billion yuan, or -37.95%. The investment income mainly came from Marion Mine and Minmetals Yili, where the company participated Projects such as Pingshan Salt Lake.

Status of upstream lithium resources: The company's lithium resources continue to achieve breakthroughs: ① Mt Marion 0.9 million tons/year spodumene concentrate production capacity is currently being gradually released; ② Cauchari's 0.04 million ton lithium carbonate project completed project construction in the first half of 2023. Currently, output has climbed to about 70% of the design capacity, and plans to complete the production of 0.02-0.025 million tons of lithium carbonate products in 2024; ③ Mariana plans to test before the end of 2024 Production; ④ The company increased its shareholding in Mali Lithium to 60%. The first phase of its Goulamina spodumene project is under construction and is expected to produce the first batch of spodumene products within this year; ⑤ the PPG project is in the process of preliminary preparation; ⑥ the exploration and transfer procedures for the Songshugang project have been completed; ⑦ the Mongjin Mining Gavus lithium tantalum project has now completed the construction and commissioning of the first phase of the 0.6 million tons/year mining project.

Midstream lithium salt deep processing: Up to now, the company has formed a lithium salt product production capacity of about 0.15 million tons or more in China. In addition to the 0.04 million ton LCE production capacity of Cauchari lithium salt lake in Argentina, the total production capacity has reached nearly 0.2 million tons of LCE.

Downstream lithium battery business: The company has set up lithium battery R&D and production bases in Xinyu, Dongguan, Ningbo, Suzhou, Huizhou, Chongqing, etc. We expect the company's lithium battery business to have an effective production capacity of about 20 GWh per year by the end of this year.

Risk warning: The construction progress of the project did not meet expectations, and the production and sales volume of lithium salt products did not meet expectations.

Investment advice: Maintain an “better than the market” rating.

The company's 2024-2026 revenue is expected to be 195.47/238.00/302.86 billion yuan (original forecast 271.70/338.31/405.04), respectively, with year-on-year growth rates of -40.7%/21.8%/27.3%, respectively; net profit to mother is 2.70/19.17/28.64 (original forecast 44.36/58.82/69.20), respectively, with year-on-year growth rates of -94.6%/611.3%/49.4%, respectively; diluted EPS is 0.13/0.95/ 1.42 yuan, current stock price corresponding PE is 205/29/19X. Considering that the company is the best quality lithium company in the world, it has now built a closed-loop lithium ecosystem, and has many high-quality lithium resources around the world. The growth is worth looking forward to, and it maintains a “superior to the market” rating.