SMM: Nomura reports that among Chinese lithium producers, it is more optimistic about Ganfeng lithium industry than Tianqi lithium industry, because Ganfeng lithium industry can achieve faster profit growth in 2018-19, supported by accelerated capacity expansion. At the same time, the return on equity is also better than the former. Nomura gave Ganfeng lithium a buy rating with a target price of 96 yuan and a neutral rating for Tianqi lithium industry with a target price of 61 yuan.

According to the summary of the 2017 annual report of Ganfeng Lithium Industry: the company achieved a significant increase in revenue and profit margin, revenue increased from 2.844 billion yuan in 2016 to 4.383 billion yuan in 2017, a growth rate of 54.12%; Net profit belonging to shareholders of listed companies increased from 464 million yuan in 2016 to 1.469 billion yuan in 2017, an increase of 216.36 percent. The company's total assets increased from 3.809 billion yuan in 2016 to 8 billion yuan in 2017, an increase of 110.02 percent, and its net assets increased from 2.488 billion yuan in 2016 to 4.037 billion yuan in 2017, an increase of 62.25 percent.

Key accounting data and financial indicators for the past three years:

Ganfeng lithium industry has seven main production bases:

The company's production line has always maintained a high capacity utilization rate:

The company may also invest in new capacity plans in the future:

Ganfeng Lithium Industry owns stakes in six high-quality lithium resources around the world, including spodumene ore and lithium-containing brine, and has purchased upstream lithium resources mainly based on resource size, development difficulty, cost and quality, underwriting, and so on. The aim is to ensure an adequate and stable supply of raw materials.

Company's mineral resources:

Note:

1) according to JORC standard;

2) according to the national standard of China;

3) according to CIM guidelines (NI43-101);

4) according to JORC standard;

5) Avalonia is in the early stage of exploration, and there is no data of lithium resources reserves.

The company's operating results for the January-March 2018 period are as follows:

Ganfeng lithium industry expects net profit to be positive in January-March 2018, up more than 50 per cent from a year earlier.