"Lithium Iron Phosphate" IPO is accepted! Science and Technology Innovation Board's first family in 2022!

Science and Technology Innovation Board IPO of Hubei Wanrun New Energy Technology Co., Ltd. (referred to as Hubei Wanrun), which is in charge of lithium iron phosphate, was accepted on January 7, according to all the information handed in.

Hubei Wanrun is the first enterprise accepted by Science and Technology Innovation Board in 2022.

Lithium iron phosphate raised 1.262 billion yuan

Hubei Wanrun plans to issue no more than 21.3038 million shares and no less than 25 per cent of the total share capital after the offering. This issue is all new shares, the original shareholders do not sell shares to the public.

Hubei Wanrun plans to raise 1.262 billion yuan, which will be invested in Hongmai Hi-Tech High-performance Lithium Ion Battery material Project (800 million yuan), Hubei Wanrun New Energy Lithium Battery cathode material Research and Development Center (62.0883 million yuan), and supplementary liquidity (400 million yuan).

Data show that Hubei Wanrun was established in December 2010, is mainly engaged in lithium battery cathode materials research and development, production and sales of high-tech enterprises, the main products include lithium iron phosphate cathode materials and precursors, lithium manganate cathode materials and so on.

Hubei Wanrun has become a supplier to many well-known lithium battery enterprises, such as Ningde era, BYD, China New Airlines, Yiwei Lithium Energy, Wanxiang 123, Ganfeng Lithium and many other well-known lithium battery enterprises.

The data show that in the statistics of production and sales of lithium iron phosphate cathode materials for lithium batteries in China, Hubei Wanrun's market share ranked second in the industry in 2018 (19.10% market share); in 2019 and 2020, Hubei Wanrun's market share ranked third in the industry (16.70% and 13.50%, respectively).

Therefore, Hubei Wanrun is the "three leaders" of lithium iron phosphate materials.

It is worth noting that Hunan Yuneng ranked first in the market share in 2020, with a market share of 22.40%, German Nano ranked second with a market share of 21.50%, and Hubei Wanrun ranked third.

Hunan Yuneng's IPO has also been accepted, rising from the fourth market share in 2019 to the first market share in 2020.

Bertre's market share fell from second in 2019 to fourth in 2020.

Hubei Wanrun has been the third for two years in a row, while competitors such as German Nano and Hunan Yuneng have a larger production capacity than Hubei Wanrun in 2020, and their recent production expansion is ferocious, adding to the huge demand for lithium iron phosphate materials in the future market, so Hubei Wanrun IPO financing to expand production coincides with the meeting.

Net profit of 184 million yuan in the first nine months of 2021

In terms of shareholders, Liu Shiqi and Li Fei directly own 27.167463 million shares of Hubei Wanrun (42.5080%). In addition, the employee holding platform Shiyankai of Liu Shiqi as a general partner and 887732 shares of the issuer (1.3890%).

In other words, Liu Shiqi and Li Fei directly and indirectly control 28.055195 million shares of the issuer (a total of 43.8970%), and hold the positions of chairman, general manager and director of the issuer, respectively, and are the controlling shareholders and joint actual controllers of Hubei Wanrun.

Financial data show that the revenue of Hubei Wanrun in 2018, 2019, 2020 and the first nine months of 2021 was 939 million yuan, 766 million yuan, 688 million yuan and 1.145 billion yuan respectively, while the corresponding net profit in the same period was 2.7301 million yuan,-73.138 million yuan,-43.0297 million yuan and 184 million yuan respectively.

In terms of business income from major products, the revenue of Hubei Wanrun Lithium Iron Phosphate material from January to September in 2021 was as high as 1.105 billion yuan, accounting for 98.57% of the main business income.

Vico Lithium noted that at the beginning of October, the price of lithium iron phosphate (power type) was 7.30-77000 yuan / ton, while by the end of December, the price of lithium iron phosphate (power type) was 10.7-111000 yuan / ton. In other words, the price of lithium iron phosphate products increased by about 44% in the fourth quarter of 2021.

In terms of technical strength, Hubei Wanrun is a national high-tech enterprise and a national "specialized special new" small giant enterprise. As of the date of signing the prospectus, the company has 58 patents, including 40 invention patents (including 7 international invention patents), 17 utility models and 1 design patent.

In terms of the top five customers, Ningde Times is the largest customer of Hubei Wanrun. The sales volume of Hubei Wanrun to Ningde era from January to September in 2019, 2020 and 2021 accounted for 63.16%, 59.43% and 43.79% of its operating income, respectively.

From January to September in 2021, BYD replaced Wanxiang 123 in 2020 as Hubei Wanrun's second largest customer, accounting for 30.33% of revenue.

It is understood that the cathode material produced by Hubei Wanrun is used in the production of BYD's "blade battery", and the BYD car equipped with "blade battery" has a range of 605km.

In addition, AVIC Lithium (China New Airlines), Yiwei Lithium Energy, Wanxiang 123, Guoxuan Hi-Tech, Anchi New Energy and Jinchi New Energy are also among the top five customers in Hubei Wanrun during the reporting period.

Market: lithium iron phosphate exceeds ternary

Return of King of Lithium Iron Phosphate in 2021: data show that from January to November this year, China's power battery production totaled 188.1 GWH, an increase of 175.5% over the same period last year. Among them, the output of lithium iron phosphate batteries totaled 105.3 GWH, accounting for 56% of the total output, an increase of 275.7% over the same period last year.

In terms of installed capacity, the installed capacity of power batteries in China totaled 128.3 GWH, an increase of 153.1% over the same period last year. Among them, lithium iron phosphate battery installed a total of 64.8 GWH, accounting for 50.5% of the total installed capacity, a cumulative increase of 270.3% over the same period last year.

The proportion of output and installed capacity are both more than 50%, that is, lithium iron phosphate batteries have fully exceeded the ternary batteries in 2021.

Under the huge market demand, the price of lithium iron phosphate material is also rising: at the beginning of 2021, the price of lithium iron phosphate (power type) is 36-40, 000 yuan / ton, and by the end of the year, the price has risen to 10. 7-111000 yuan / ton.

Hubei Wanrun's prospectus mentions that in the field of passenger cars, models with lithium iron phosphate are coming from behind: with the influence of policy factors such as subsidies, the cost advantages of LFP are beginning to appear, and more vehicle manufacturers have begun to launch new energy models with LFP, such as lithium iron phosphate version Model3, BYD Han, Hongguang MINI and so on.

Lithium iron phosphate occupies a dominant position in the field of passenger cars and special-purpose vehicles, needless to say.

In the field of non-power batteries, lithium iron phosphate mainly involves three applications: 5G base station energy storage, new energy generation end energy storage and lead-acid market substitution.

By the end of 2020, the total number of 5G base stations in China is 718000. It is estimated that by 2025, the number of 5G base stations in China will reach 8.16 million. Based on the estimated power consumption of about 2700W per 5G base station and emergency 4 hours, from 2021 to 2025, the 5G base station energy storage market will provide 15.5GWh lithium iron phosphate battery demand space, corresponding to the LFP material demand of about 36000 tons.

The new installed capacity of electrochemical energy storage is 2.5 GW in 2021, and the cumulative installed capacity is expected to reach 35.52/55.88GW by 2025. And in the field of electrochemical energy storage in 2025, there will be an additional demand space of 13.0-23.1Gwh, corresponding to the demand of 3.0-54000 tons of LFP materials.

In 2020, the output of lead-acid batteries in China is 227.36GWhh, corresponding to more than 130 billion alternative space. About 33% of them are used in light power batteries, mainly in the power system of electric two-wheelers.

In 2020, China produced 11.36 million lithium electric two-wheelers, with an overall penetration rate of 23.5 per cent, an increase of 84.7 per cent over the same period last year. The market penetration of the entire lithium electric two-wheeler is expected to be close to 60% by 2025.

In 2020, shipments of lithium batteries for electric two-wheeled vehicles in China reached 10.7 GWH, an increase of 91.1% over the same period last year. It is estimated that the demand for lithium batteries for electric two-wheeled vehicles will reach 45.9Gwh by 2025.