Go straight to the shareholders' meeting! Hastened too quickly, price increases considered to be passed downstream, solid-state batteries were poured cold water, energy storage may take off, Ningde era revealed four important messages!

Financial Associated Press (Ningde, reporter Mu Bai) News, there are people close to the Ningde era (300750.SZ) have said that the company's chairman Zeng Yuqun named "Ningde era", in fact, want to say that this is "your time". On May 21, a reporter from the Financial Associated Press told the local taxi driver on his way to the shareholders' meeting of the Ningde era that the driver had already driven a new energy car. He scratched the back of his head sheepishly and said with a smile, "he is the one who caught up with the times!"

The above drivers may not know that the Ningde era has accounted for the world's largest share of power battery usage in the past four years in a row. When investors asked at the 2020 shareholders' meeting of the Ningde era how to maintain their advantage in the competition, Zeng Yuqun said cheerfully: "our global market share in the first quarter of this year is steadily higher than that of last year, which is also a good proof!"

Obviously, investors are not only concerned about the present, but also more concerned about the future of the Ningde era. According to the contents of the shareholders' meeting sorted out by reporters of the Financial Associated Press, Zeng Yuqun and other senior executives believe that, first, the current time required for capacity expansion is 2-3 years, as long as 3-5 years, which will be gradually advanced according to the market and orders, and is currently being urged too quickly by customers; second, the rise in the price of raw materials has a greater impact on the company's costs, but to what extent it needs to be transferred downstream is still under consideration. Third, the real commercialization of solid-state batteries still has a long way to go; fourth, energy storage business may "take off".

Expansion of production capacity and hastening of goods

Jiang Li, secretary of Ningde Times, said that "the scale of announced production capacity investment has exceeded 90 billion yuan". According to a research report by Guojin Securities in May, the company has planned eight wholly-owned production bases with a planned production capacity of more than 500GWh. coupled with the joint venture capacity of 95GWhwith the mainframe factory, the total planned production capacity has reached 600GWh, ranking first in the world.

However, in the lithium power plant, expansion is not news, not expansion is. In the first quarter of 2021, there were 21 domestic lithium power expansion projects, and the amount and scale of investment increased significantly compared with the same period last year. It is not difficult to find that lithium power plants are engaged in an "arms race".

In terms of the market, Zeng Yuqun said, "customers have urged the goods too quickly recently." With regard to the expansion of production capacity, Jiang Li added that at present, the time required for capacity expansion is 2-3 years, and as long as 3-5 years, which will be gradually promoted according to the market and orders. "We are also placing orders with suppliers one after another to buy some equipment."

The reporter noted that in May this year, five enterprises have successively announced that they have won the equipment orders of the Ningde era, with a total amount of more than 2 billion yuan. Among them, today, 300532.SZ received 441 million yuan of orders from Jiangsu Times to provide automatic capacity testing system, Huazi Science and Technology (300490.SZ) won the bid for lithium battery production equipment of Ningde Times and its subsidiaries about 251 million yuan, and Haimu Star (688559.SH) received 673 million yuan orders from Jiangsu Times and Sichuan Times, involving other power battery laser and automation equipment such as high-speed laser processors. In addition, there are Nebula shares (300648.SH), first benefit Technology (688155.SH) and so on.

Interestingly, an institutional researcher asked: "the recent order of Himuxing is mainly a high-speed laser machine for the production of Tesla 4680 battery. does this mean that the company has received 4680 of Tesla's order?" In this regard, Jiang Li, as Dong's secretary, was quite witty and did not make a positive response, and only explained the reasons for the supplier's announcement. As a matter of fact, some investors asked on the interactive platform whether the high-speed laser maker of Haimu Star was used in Tesla 4680 battery, but there was no positive response from Neptune.

However, since Ningde era has intensively announced capacity expansion in the fourth quarter of last year, and Synchronize has purchased a large amount of equipment, it can be expected that in order to match production capacity, more orders for lithium power equipment may be landed in the second half of the year. According to the total orders for lithium power equipment issued in less than seven months since October 2020, the cumulative number of orders issued in Ningde has exceeded 12 billion yuan.

The rise in the price of raw materials "consider passing it downstream"

The rise in raw material prices is an unavoidable problem at the shareholders' meeting, whether upstream lithium carbonate, lithium hydroxide, or cathode materials, electrolytes, etc., are significantly higher than last year. "indeed, with the explosive growth of production capacity and market demand, we still feel a lot of pressure on the industrial chain, especially the pace of upstream production expansion, which does not fully match the demand drive of the market," Jiang explained. "

The Ningde era may have been aware of this for a long time, and there is a layout for both the upstream and downstream of the industrial chain. In addition, the announcement in April this year shows that the company plans to invest in high-quality listed companies in the industrial chain at home and abroad in the form of securities investment, with a total investment of no more than 19 billion yuan. The main reason is that there are still some shortcomings in the industrial chain, such as imperfect supporting facilities and insufficient supply of key resources, which can not meet the market demand and may restrict the long-term development of the industry.

In response to the decline in gross profit margin, Zheng Shu, chief financial officer of Ningde era, stressed that "the gross profit margin of the company has gone down in the past few years, which is in line with the development trend of the industry." If electrification (permeability) can be further improved, too high profits are obviously not conducive to the development of the industry. "

It is reported that although the comprehensive gross profit margin in the Ningde era has gradually declined, the decline has slowed down. with the release of the company's production capacity, the improvement of the level of process manufacturing, and the deep cooperation of the industrial chain, the company's gross profit margin will remain at a reasonable level. According to the annual reports over the years, the company's comprehensive gross profit margin from 2016 to 2020 was 43.7%, 36.3%, 32.8%, 29.1% and 27.8%, respectively.

Zeng Yuqun added, "Lithium carbonate or nickel and cobalt is the only thing in the world." Now we are also doing some layout in nickel, cobalt and lithium to let them really understand that it is only at a reasonable price (business) that they can do business in the long run. "

Its further analysis, "if (raw materials) rise very high, it will certainly have a greater impact on our costs." (but) to what extent should it be passed on downstream, we are also considering this question. " At the same time, he put down the "cruel words", "if they desperately raise prices at random, they will also be a little guilty, because we can exclude it."

In the meantime, Zeng Yuqun revealed, "We may release some [products] in July, for example, our sodium battery has matured." "in the past, there was a lot of speculation about cobalt (price), so we tried our best to be cobalt-free, and what if nickel started to stir up again? We said (do) nickel-free "and said with a smile," our chemical system is progressing very fast, but there is still a lithium in it, it is still stir-frying, I will get rid of it for you right away, get a sodium, what do you think of frying it? I don't think sodium chloride can stir-fry, (because) there's a lot of salt, right? " This specious remark caused a lot of laughter in the venue.

After a slap, Zeng Yuqun also gave a "candy". As long as raw materials companies earn a reasonable profit, they are basically at peace, he says, because rebuilding the supply chain is also complicated. It is reported that in 2020, the cost of materials accounts for about 80% of the cost of power battery system in Ningde era, and the cost of labor is about 20%.

The commercialization of solid-state batteries is "poured cold water"

The commercialization of solid-state batteries has been broken by Zeng Yuqun. Zeng Yuqun said that the solid-state battery is considered to be the battery with the highest energy density, but it is inherently difficult because the ion diffusion rate in the solid state is 10 times harder than that in the liquid state. From a technical point of view, solid-state batteries in Ningde era have been studied continuously for 6 or 7 years, and the technical level must be in the first echelon, but it will take quite a long time for commercialization.

Ion diffusion difficulty, diffusion coefficient and diffusion distance is one of the problems faced by solid-state batteries. Zeng Yuqun analysis, because the solid-state ion diffusion velocity is 1/10 of the liquid, so to increase the power, the solid material particles can only be nanocrystallized. However, after nanocrystallization, porous electrodes need more adhesives, layers become thinner, and more fluid collectors are needed. Overall, at current levels, the energy density is about 40% lower than that of the liquid, but the cost is higher.

"We usually look at three things, one is technical feasibility, we call it a technology roadmap, the second is a product roadmap, and the third is a commodity roadmap." Zeng Yuqun said: first of all, it depends on whether the technology is feasible; the second is to make a product, considering whether the equipment, technology, reliability, safety, and other aspects are satisfied; and the third is whether it will be too expensive. "the same thing is too expensive. If it can't be sold, it can't make a profit, so it won't do business."

Energy storage business may "take off"

"at the beginning of the establishment of the company, the goal of the business was one for power batteries and the other for energy storage batteries." Huang Shilin, vice chairman of Ningde Times, said. However, due to the lack of policy guidance and encouragement in the early days, the development of energy storage was slightly slower than that of power batteries, and recently it has gradually begun to heat up with the goal of mass entrepreneurship and innovation.

Huang Shilin further analyzed that over the past decade, the industry has been exploring the technology and operation mode of energy storage all the time. At present, from the company's point of view, the bottleneck of the energy storage industry is no longer in the technology and cost, but in the mechanism.

It is reported that from this year to next year, the overseas energy storage operation mechanism will gradually mature, so this year we should see that the overseas energy storage market will develop very rapidly. In China, recently, the relevant national management departments have also done a lot of research, so there is a very clear operation mechanism and management mechanism in the future, and the domestic energy storage business may also begin to "take off".

Huang Shilin believes that carbon reaches its peak and is carbon neutral. There are only two ways, one is the energy production side, and the other is the energy consumption side. For the energy and electricity production side, it must be replaced by clean energy. Nuclear power, wind power is limited, the most important is photovoltaic. As far as the consumer side is concerned, both oil and gas should be electrified. In the future, including construction machinery, wharf machinery, agricultural machinery and offshore vessels will all become electric.

Because photovoltaic volatility is relatively "strong", Huang Shilin said, "photovoltaic power quality must be greatly improved by using energy storage, so the main clean energy power stations in the future will be photovoltaic or wind storage power stations." From the point of view of our country,. That is, by 2030, how many clean energy sources we have to allocate means how much energy storage we have to allocate. "

According to the notice on the Development and Construction of Wind and Photovoltaic Power in 2021 recently issued by the National Energy Administration, the wind and photovoltaic power projects to be connected to the grid in 2021 are mainly stock projects. including wind power projects approved before the end of 2020 and within the approved validity period, 2019 and 2020 parity wind photovoltaic projects and competitive photovoltaic projects, with a scale of about 90 million kilowatts.