Fengyuan Co., Ltd.: the new base of lithium battery cathode material starts to build the head customer to grab the production capacity.

Lithium iron phosphate prices continue to rise, related stocks have become a hot spot in the capital market. Recently, the construction of Anqing production base of lithium battery cathode material of Fengyuan (002805.SZ) has been officially started, which has attracted great attention from institutional investors. A reporter from the Financial Associated Press found that since November, about 99 institutions have conducted research on the company in the form of on-site or teleconference, becoming one of the stocks with the highest attention in the market recently.

The relevant person in charge of the company told the Financial Associated Press that as an important strategic direction of Fengyuan shares, the company will make every effort to promote the construction of Anqing cathode material project and strive to form an annual production capacity of 50,000 tons of lithium iron phosphate within two years.

It is reported that the Anqing production base project planned by Fengyuan Co., Ltd. covers a total area of 132mu and has a total design capacity of 50,000 tons of lithium iron phosphate per year. The project will be implemented in two phases, with a construction scale of 25000 tons per year and a total investment of up to 1 billion yuan.

Since the beginning of this year, the development of Synchronize in the power market and energy storage market has led to a sharp increase in demand for lithium battery cathode materials, especially lithium iron phosphate, and the market continues to be in short supply. Relevant data show that the current market price of lithium iron phosphate is about 87000 yuan / ton, an increase of 126.0% compared with the price of less than 40, 000 yuan / ton at the beginning of the year.

Fengyuan Co., Ltd. was originally a leading enterprise in the field of industrial oxalic acid. Since its listing in 2016, the company has begun a strategic transformation, focusing on the development of new energy lithium battery cathode materials industry. At present, the company has formed a dual main business structure of oxalic acid chemical industry and new energy lithium cathode material industry.

In terms of cathode materials, the company also has the mass production capacity of both lithium iron phosphate and ternary materials. Among them, the company's Zaozhuang headquarters of the first phase of lithium iron phosphate project production capacity of 5000 tons / year and conventional ternary materials phase I project production capacity of 3000 tons / year has already achieved mass production; Zaozhuang headquarters lithium iron phosphate phase II project capacity of 5000 tons / year and conventional ternary material phase II project capacity of 2000 tons / year, has been put into production in October this year, is currently in the capacity climbing stage.

In addition, the company announced on November 26th that the company intends to sign the Investment Cooperation Agreement with the people's Government of Taierzhuang District for the production base project of cathode materials for lithium-ion batteries to build a project with an annual output of 75000 tons of cathode materials for lithium-ion batteries.

Financial data show that in the first half of this year, Fengyuan shares cathode materials business income of 168 million yuan, more than oxalic acid business to become the company's main source of income. In the third quarter of this year, the company achieved revenue of 233 million yuan, an increase of 123.07% over the same period last year, and a net profit of 16 million yuan, an increase of 2959.48% over the same period last year.

According to the relevant person in charge of the company, on the whole, the company's cathode materials business achieved better growth in the third quarter, the proportion of revenue further improved, and the profit level also improved. At the same time, the performance of the company's cathode material products has also been recognized by the head customers, and established a good long-term cooperative relationship, which is expected to promote the good growth of the company's performance.

The reporter noticed that in Fengyuan shares of downstream customers, there is no lack of BYD (002594.SZ) and Penghui Energy (300438.SZ) such a loud name.

The company said that in July this year, the company began to supply BYD in batches. according to preliminary statistics, the products it supplied to BYD in the third quarter accounted for half of the company's sales of lithium iron phosphate in the same period. this also makes BYD one of the company's most important downstream customers.

In addition to BYD, Penghui Energy has also thrown a big order to compete for the company's cathode material production capacity. According to the company announcement, Fengyuan Lithium Energy, a wholly owned subsidiary of Fengyuan, signed a "Cooperation Agreement" with Penghui Energy to purchase lithium iron phosphate and lithium nickel cobalt manganate products from Fengyuan Lithium Energy from December 2021 to December 2022, with a total contract amount of about 800 million yuan.

It is reported that the supply of Fengyuan shares to Penghui Energy is mainly lithium iron phosphate, and there are also some high-nickel ternary cathode materials.

On the question of whether the supply contract signed with Penghui Energy will crowd out the company's share of the supply of lithium iron phosphate to BYD, the person in charge of the aforementioned company said that the 5000 tons of lithium iron phosphate production line of the company's Zaozhuang headquarters has begun mass production. With the release of the company's lithium iron phosphate capacity, the company will negotiate with major partners to match the supply quantity and meet customer demand through high-quality products and services.