"Leopard Change" Of Jiangte Electric Co., Ltd.: Stepping On The Rhythm Point Of "Lithium" Turning Into Gold In Half A Year

Jiangte electric (002176. SZ), whose performance and share price soared together, ushered in the reduction of important shareholders.

According to the announcement on July 28, Yichun Yuanzhou District State owned Assets Operation Co., Ltd., the second largest shareholder of jiangte Electric Co., Ltd., plans to reduce the total holding of 34126500 shares, accounting for 2% of the company's total share capital, within 6 months after 15 trading days.

Affected by this news, jiangte electric machinery, which had a strong stock price performance before, had a limit on July 28, closing down 9.84%.

Before this, due to lithium carbonate into the "tuyere" of rising prices, jiangte Electric Co., Ltd.

According to the performance forecast, the net profit of jiangte Electric Machinery Co., Ltd. in the first half of this year will increase by 6214.73% to 6575.57% compared with the same period of last year, realizing a profit of 175 million yuan to 185 million yuan.

According to the data, the highest annual net profit of jiangte Electric Co., Ltd., which was listed in 2007, was 281 million yuan in 2017, while the expected lower limit for the first half of this year was 62.28% of the highest annual performance in history.

"Lithium carbonate is in short supply, and its price is at a record high." On the afternoon of July 28, relevant personage of jiangte Electric Co., Ltd. told the reporter of the 21st century economic report that "in the first half of this year, the lithium carbonate business contributed about 60%

Jiangte Electric Co., Ltd., which focuses on the development of electric machinery and lithium salt industry, plans to realize the main business income of 3.83 billion yuan and net profit of 410 million yuan in 2021. Visual China

Lithium carbonate price rise and fission

Jiangte electric machinery is working fast.

"The company's goal is to achieve a daily production capacity of 120 tons of lithium carbonate by the end of the year after technical transformation, and the current daily capacity is 60 to 80 tons." The relevant people of jiangte Electric Machinery Co., Ltd. told the reporter of the 21st century economic report.

According to the plan, jiangte Electric Co., Ltd. plans to produce and sell 27200 tons of lithium carbonate products in 2021.

"The company's lithium carbonate is sold to manufacturers producing cathode materials. Lithium carbonate products are the basic materials in the production of cathode materials such as lithium iron phosphate, ternary and lithium manganate. It takes several processes to become a power battery. The final customers may be Ningde times, BYD, etc Said the relevant person of jiangte Electric Co., Ltd.

Compared with the early stage, the production cost of lithium carbonate of jiangte electric machinery has been greatly reduced.

"In recent years, with the rise of lithium carbonate price, the prices of main and auxiliary materials for preparing lithium carbonate have also increased. Therefore, the production cost of lithium carbonate of the company will change. At present, the comprehensive cost of processing lithium carbonate with its own mineral resources is controlled at about 45000 yuan per ton." At the end of April this year, jiangte Electric Co., Ltd.

In 2017, the cost of lithium carbonate of jiangte motor was about 70000 yuan / ton.

According to jiangte electric machinery, the company has carried out technical transformation work from two dimensions of improving product quality and reducing product cost. By optimizing the front-end process, the output of lithium mica extraction line has increased by about 35%. By optimizing the proportion of auxiliary materials, neutralization and impurity removal, evaporation and other processes, the cost of lithium carbonate per ton has decreased by about 1500 yuan.

At the end of April this year, jiangte Electric Machinery Co., Ltd. also said that the company carried out technical transformation for the front section roasting in May, which could increase the recovery rate by 3%, and reduce the use cost of natural gas by building its own gas liquefaction station.

"At present, the price of lithium carbonate is relatively stable, with a price of 890000 yuan per ton." Said the relevant person of jiangte electric machinery.

Jiangte electric also said that the external environment of lithium carbonate continued to improve from December 2020, the downstream demand increased, and the sales price increased significantly year on year.

Jiangte Electric Co., Ltd., whose stock price had been falling continuously, turned back and rose in November 2020 when the price of lithium carbonate stabilized. From November 3, 2020 to July 23, 2021, its share price rose as high as 870.72%, of which, from July 1 to 23 this year, its share price soared by 128.48%.

Jiangte motor, which focuses on the development of electric machinery and lithium salt industry, plans to realize the main business income of 3.83 billion yuan and net profit of 410 million yuan in 2021.

"The trend for the whole year should be the same, with lithium carbonate accounting for about 60% of revenue." The relevant people of jiangte Electric Co., Ltd.

There is no downstream deep processing plan

Jiangte Electric Co., Ltd. has abundant upstream resources.

According to the regular report, 70% of jiangte's lithium carbonate products are processed and produced by using lithium mica.

"The company makes full use of the advantages of its own lithium resources, through the comprehensive application of lithium mining and beneficiation and the deep processing of lepidolite, it can effectively guarantee the supply of main raw materials for preparing lithium carbonate and better control the cost of raw materials." Jiangte electric pointed out.

According to the data, the lithium resources controlled by jiangte Electric Machinery Co., Ltd. include mining rights and exploration rights, covering a total area of 5.5 square kilometers. At present, the proven lithium resource reserves are 93.6 million tons, and there are three ore sources in the detailed investigation stage, with a total of more than 100 million tons of lithium resources held or controlled.

According to jiangte Electric Machinery Co., Ltd., the proven lithium China stone reserves and the lithium China stone reserves in the detailed investigation stage have been integrated into lithium carbonate equivalent of more than 2 million tons.

This means that, based on the plan of producing and selling 27200 tons of lithium carbonate products in 2021, the above 2 million tons of lithium carbonate equivalent can be used for 73.53 years.

"The company is the domestic private enterprises in the most lithium mica resources of enterprises." "The company is preparing to expand its production. First, it will carry out technical transformation through existing projects to increase production capacity and increase production capacity, and then continue to increase production capacity according to market conditions," said Jiang te electric

But jiangte electric machinery has been waiting for more than 10 years to meet this "tuyere".

According to the public information, jiangte started its involvement in lithium battery in 2009. In June of that year, jiangte Lithium Battery Co., Ltd. was established. It hopes to develop upstream and downstream of lithium battery industry, such as lithium mine, lithium battery, automobile motor, electric vehicle drive assembly and special electric vehicle.

However, the plan can not keep up with the changes. The cross-border development of jiangte Electric Co., Ltd. will lose 3.684 billion yuan in 2018 and 2019, and the "lithium idea" of the whole industrial chain is broken, and it has to shrink and slim down.

Meanwhile, lithium carbonate products fell into the freezing point.

In 2019, the supply and demand of lithium carbonate market is unbalanced, and the price drops from 68000 yuan / ton at the beginning of the year to 42000 yuan / ton at the end of the year; In 2020, the operating income of jiangte motor's lithium carbonate business decreased by 74.44% year-on-year, and the revenue was only 124 million yuan. Most of the time, the market price of lithium carbonate products was lower than the cost price, resulting in the deduction of non net profit of this business of -178 million yuan in that year.

"In 2020, the company disposed of the relevant assets of non main business, focusing on the development of motor and lithium carbonate. In the future, the focus is on lithium carbonate, and the growth of motor is stable." Said the relevant person of jiangte Electric Co., Ltd.

The relevant personnel of jiangte Electric Co., Ltd. also disclosed that the company has no plan to enter the downstream deep processing of lithium carbonate.

Increasing exploitation of lepidolite resources

Although the current price of lithium carbonate is far lower than the historical peak of 180000-190000 yuan per ton, compared with the cost of 45000 yuan per ton, the price of 80000 to 90000 yuan per ton has a larger profit margin for jiangte motor.

However, it is not without worries.

According to the data quoted by jiangte Electric Machinery Co., Ltd., the global planned output of lithium carbonate will reach 824000 tons by 2025, significantly higher than the predicted demand of 543000 tons.

However, jiangte Electric Co., Ltd. said that if excluding the projects only planned but not constructed and the three-year production cycle, the global effective capacity of lithium carbonate is expected to be only 568000 tons by 2025, which is slightly higher than the forecast value of demand, and the surplus is not serious. "If the demand side shows an over expected growth, there may be a shortage of lithium carbonate supply, leading to a substantial price rise.".

Jiangte electric also said that the current round of lithium carbonate price rise is driven by the market, and its duration cycle is long.

Everbright Securities research also believes that in the next two years, the global supply and demand of lithium carbonate is still in a tight balance. According to the global cost curve, the central price of lithium carbonate from 2021 to 2023 will reach 90000 yuan / ton, 110000 yuan / ton and 128000 yuan / ton respectively.

"The company is planning to increase the exploitation of its own lithium mica resources." Jiang te electric Chairman Hu Chunhui said in 2021 investor collective reception day.

Before that, jiangte Electric Machinery Co., Ltd. expected to produce about 200000 tons of lepidolite concentrate in 2021, while it had 70000 tons of lepidolite inventory at the end of last year.

According to the information disclosed by jiangte Electric Machinery Co., Ltd., through mining its own lithium porcelain ore, it extracts the main product lepidolite from the lithium porcelain stone, and then deeply processes it into lithium carbonate products.

"The company's lithium carbonate uses lepidolite, and Tianqi lithium industry uses spodumene, with different ore sources." The relevant personage of jiangte Electric Co., Ltd. told the reporter of the 21st century economic report that "the use of lithium mica is more, but the cost is lower; Spodumene is used less, but the price of energy consumption is higher. Lepidolite has a comparative advantage. "

Previously, the price of purchased spodumene announced by jiangte Electric Co., Ltd. was about 5000 yuan / ton, "lithium extraction from spodumene is only a supplement to the company's lithium salt business".

"The company does not sell lithium China stone for its own use. If the downstream demand is large, it will entrust the ore to other concentrators for processing, and extract lithium mica back to the company." Jiangte electric machinery in the acceptance of agency research said.

However, there is also a capital bottleneck in jiangte motor's expansion.

"To achieve the goal of technical transformation and expansion of production, we need to see the equipment in place and the capital situation in the later stage." Said the relevant person of jiangte Electric Co., Ltd.

According to the first quarter report, the monetary capital of jiangte electric machinery is only 255 million yuan, but the asset liability ratio is 66.16%.