Demand for lithium products such as lithium hydroxide continues to improve and prices are strong, prompting the performance of relevant listed companies to rise sharply, and 002497.SZ expects net profit to soar by more than 184 per cent in 2021. For lithium products and other price trends expected, industry insiders told the Financial Associated Press, from the upstream lithium concentrate to see less new capacity in 2022, downstream demand is strong, the penetration of new energy vehicles continues to accelerate, the overall supply is expected to be tight.
On the evening of January 12, Yahua Group announced its performance forecast that the company is expected to make a profit of 920 million-1.05 billion yuan in 2021, a year-on-year increase of 184.09%-224.23%. The net profit after deducting non-profit is expected to be 892 million-1.022 billion yuan, a year-on-year increase of 198.20%. Basic earnings per share are expected to be 0.80 yuan per share-0.91 yuan per share.
As for the reasons for the huge increase in performance, the company said that its two main industries, Civil explosion and Lithium Industry, continued to make efforts, the Mindang business developed steadily, and the demand of the lithium industry continued to rise; the company seized the cycle of the new energy industry to release production capacity and increase sales, with a substantial increase in sales of lithium salt products, a substantial increase in lithium business profits, and a significant improvement in the company's overall profitability.
A reporter from the Financial Associated Press recently learned from an industry source that Ya Hua Group currently has a total of about 43000 tons of lithium salt products (including lithium hydroxide, lithium carbonate products, etc.), which is expected to be put into production in 2022, with a total planned production capacity of 100000 tons by 2025.
At present, the company's related lithium salt products continue to have high bearing. According to the spot price of SMM, the latest quotation of battery-grade lithium hydroxide was 321000 yuan / ton on January 13th, with a strong bullish atmosphere in the market. The average price of battery-grade lithium carbonate has jumped from 50, 000 yuan / ton at the beginning of 2021 to more than 300000 yuan / ton recently, an increase of more than 400%.
"Click to view the spot price of SMM metal
From the perspective of the industry, the above-mentioned industry insiders told the Financial Associated Press that from the upstream lithium concentrate supply of lithium salt products, the increase this year is relatively small, basically at the same level as last year, so the supply side is relatively tight; from the demand side, according to the China Automobile Association data, sales of new energy vehicles are expected to reach 5 million in 2022, the permeability is increasing rapidly, and downstream demand is strong. Therefore, from the point of view of supply and demand, the overall supply is expected to be tight.
It is worth mentioning that Ya Hua Group has formed a model of upstream protection and downstream protection. For customers, according to a major contract agreement signed with Tesla, Tesla purchased battery-grade lithium hydroxide products with a total value of US $6.3-880 million from Ya'an Lithium Industry from 2021 to 2025, as well as cooperation with LG and other customers.
Upstream, Ya Hua Group has protected its own priority supply rights by signing lithium concentrate off-take agreements with Yinhe Lithium Industry, Lijiagou Lithium pyroxene Mine, Australia Core, etc., and subscribing for a stake in Australia's EV Resources Company. Among them, the implementation period of the agreement with Galaxy Lithium Industry is until 2025, and it is agreed that Galaxy Lithium Industry will provide no less than 120000 tons of lithium concentrate per year.
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