Fengyuan Lithium Energy another cathode material base starts to build major customers' orders have been issued one after another.

Since the beginning of this year, with the continuous development of national policy and market demand, the sales of new energy vehicles continue to refresh institutional expectations, leading to a high demand in the field of lithium materials. In this context, Fengyuan shares (002805) cathode material industry is accelerating into the development period.

On the morning of November 27, the groundbreaking ceremony of the production base of lithium ion power battery cathode materials of Anhui Fengyuan Lithium Energy Technology Co., Ltd. (referred to as Anhui Fengyuan Lithium Energy) was held in Jingkai District, Anhui Province.

According to reports, Anhui Fengyuan Lithium Energy is jointly funded by Shandong Fengyuan Lithium Energy Technology Co., Ltd., a wholly-owned subsidiary of Fengyuan Co., Ltd., and Anhui Jintong New Energy vehicle Phase II Fund Partnership (Limited Partnership). Fengyuan Lithium Energy holding subsidiary, which was registered and established in Economic Development District of Anqing City on September 16, 2021, the company's planned positive material production base project covers a total area of 132mu and a construction area of 47900 square meters. The total design capacity is 50, 000 tons of lithium iron phosphate per year, and the project is implemented in two phases, with a construction scale of 25000 tons per year.

Zhao Guanghui, chairman of Fengyuan Co., Ltd., said in a speech at the event: "the Anqing base project is a major project for us to seize the development opportunities of the new energy industry, speed up the scale of production lines, and lay out major projects in the Yangtze River Delta region. We will go all out to release production capacity, strive to form an annual capacity of 50,000 tons of lithium iron phosphate within two years, and help Anqing build an automobile industrial cluster of hundreds of billions."

It is reported that Anqing Economic Development Zone in Anhui Province is a national economic and technological development zone, and it is also one of the most important national development zones in Wanjiang city belt to undertake industrial transfer. it is a national demonstration zone for private science and technology enterprises and a national high-tech industrial base for auto parts. At present, the third phase of Anqing Economic Development Zone is focusing on the construction of new energy vehicles and auto parts, high-end equipment manufacturing and other emerging strategic industries. Jianghuai Automobile, Futian Resa, Chery Anqing Zhenyi and other well-known enterprises of new energy vehicles and intelligent recharging related enterprises have been introduced one after another. Fengyuan shares lithium cathode material production base landed here, will also benefit from its industrial environment to achieve rapid development.

Continuous expansion of positive production capacity

Fengyuan shares, headquartered in Zaozhuang, Shandong Province, has been listed on the small and medium-sized board of the Shenzhen Stock Exchange in 2016, focusing on the strategic transformation of the development of new energy lithium battery cathode materials industry while maintaining the traditional advantage industry oxalic acid chemical industry. At present, the company has gradually formed a dual-main business structure based on oxalic acid chemical industry and new energy lithium cathode material industry. Among them, in terms of cathode materials, the company is a rare enterprise in the industry with both lithium iron phosphate and ternary mass production capacity. In terms of technology, it has successfully broken through the technical barrier of high nickel and become a new force in the field of lithium cathode materials.

The battery network learned that Fengyuan Lithium cathode material business is mainly implemented by Fengyuan Lithium Energy, a wholly-owned subsidiary, and the construction and design capacity of the Zaozhuang base is 25000 tons / year. Anqing base currently plans to produce 50, 000 tons / year lithium iron phosphate, totaling 75000 tons / year.

In terms of capacity construction, the first phase of lithium iron phosphate project (capacity 5000 tons / year) and conventional ternary phase I project (capacity 3000 tons / year) in Zaozhuang of Fengyuan shares have been completed and put into production. Lithium iron phosphate second phase project (capacity 5000 tons / year) and conventional ternary second phase project (capacity 2000 tons / year) have been gradually put into mass production since October 2021, and the high nickel ternary demonstration line (production capacity 2000 tons / year) has also been in the stage of trial production. The construction of surplus production capacity will be pressed forward according to the construction plan of fund-raising projects.

In addition to the above-mentioned two production bases, Fengyuan also announced on November 26th that the company intends to sign the Investment Cooperation Agreement with the people's Government of Taierzhuang District on the project of production base for lithium-ion battery cathode materials, with a total investment of no more than 3 billion yuan and a planned construction project with an annual output of 75000 tons of lithium-ion battery cathode materials.

If the Taierzhuang lithium battery cathode material production base project is successfully promoted and successfully reached production, Fengyuan Co., Ltd. will double the total production capacity of cathode materials to 150000 tons / year, making it the top supplier of cathode materials in China.

With such a large-scale expansion of production, where is the strength of Fengyuan shares? It starts with the market and customers.

High-quality orders have been issued one after another.

Benefiting from the rapid increase in upstream power battery demand and the accelerated pace of investment and production expansion, Fengyuan shares achieved good growth in cathode materials business in the third quarter, and the proportion of income further increased, which promoted the good growth of the company's performance. In the third quarter, the company achieved revenue of 233 million yuan, an increase of 123.07% over the same period last year, while the net profit belonging to shareholders of listed companies was 15.9975 million yuan, an increase of 2959.48% over the same period last year.

It is worth noting that, according to Fengyuan shares, in July this year, the company's lithium iron phosphate products were officially supplied to BYD in bulk, and now BYD has become an important customer of the company. In addition, the company's regular ternary products also have new customers.

In addition to BYD's endorsement, recently, Fengyuan shares have also received strong support from an old friend Penghui Energy. On November 26, the company announced that wholly-owned Zi Fengyuan Lithium Energy and Penghui Energy signed a "Cooperation Agreement". It is agreed that Penghui Energy will purchase lithium iron phosphate and lithium nickel cobalt manganate (nickel 5 series and high nickel 8 series) products from Fengyuan Lithium Energy from December 2021 to December 2022, with a total contract value of about 800 million yuan, which is 2.24 times of last year's annual income.

Battery Network noted that in the past three years, Fengyuan shares have been closely linked with Penghui Energy. The sales revenue from Penghui Energy was 87.6414 million yuan in 2019, decreased due to the epidemic in 2020, rebounded rapidly in 2021, and reached 73.753 million yuan from January to October. Accounting for 18.16% of the company's main business income, if the newly signed order of 800 million yuan is successfully implemented, it will be as much as 10 times the size of the transaction between the two sides in the first 10 months of this year. In addition, Penghui Energy also announced on the 25th that it plans to invest 6 billion yuan to build a Penghui smart energy storage and power battery manufacturing base with a planned production capacity of 20GWh.As an important supplier of upstream materials, the company may continue to benefit.

In addition, according to a research report released by Guosheng Securities a few days ago, in order to better expand the business of cathode materials, Fengyuan shares have also opened up new customers: domestic and foreign head battery companies such as LG new energy, Lishen battery, honeycomb energy, etc.; Voltaitong has begun to supply in bulk. In addition, the company has signed the Strategic Cooperation Framework Agreement with Shenzhen Zhuoneng, Anhui Wuxing Power and Zhongbei Runliang, and the above-mentioned companies will give priority to purchasing high-nickel ternary cathode materials, thus forming a certain guarantee for the company's high-nickel ternary product orders.

At present, under the historical opportunity of the development of the industry and the continuous increase of high-quality customer orders, Zhao Guanghui told Battery Network that in the future, the company will continue to strengthen technology research and development, maintain close cooperation with downstream customers, and continue to expand the production capacity of new materials, strive for the total production capacity of Shandong headquarters base and Anqing base to reach tens of thousands of tons in the past two years, and make due contributions to the development of the whole new energy industry.