Guanghua Technology rearranges waste Power Battery Recycling Business has a mature procurement and sales model to cope with material price fluctuations

SMM April 1: last night, Guanghua Science and Technology announced that the company and ground Railway signed a "strategic cooperation agreement" in Shenzhen, in which the two sides will devote themselves to building a recycling system of waste power batteries, through legal recycling, disassembly and remanufacturing of waste power batteries to reduce the harm to the environment caused by random abandonment, and jointly explore a comprehensive service plan for the recovery of mileage of operating vehicles. Jointly build a regionally distributed comprehensive maintenance service station for power battery of new energy vehicles to achieve the coordinated development of economic and social benefits, so as to speed up the construction of reverse cycle system of power battery.

According to public information, the above-ground Railway Rental car (Shenzhen) Co., Ltd. is mainly engaged in car rental, car maintenance and the operation of new energy vehicle charging facilities. According to the agreement, the ground Railway will hand over the decommissioned power batteries of the operating vehicles to Sinorama Technology for compliance recycling as well as the batteries replaced by daily maintenance.

Through a comprehensive test of the battery, Sinorama Science and Technology screened out the cells, modules or whole packages that can be used in echelons, and re-PACK produced different types of echelon battery packs, which can be used in industrial energy storage, special vehicle power system, backup power supply, household energy storage, etc. For the rest of the scrapped batteries that cannot be used step by step, Sinorama Technology uses the leading hydrometallurgical technology for harmless recycling, and the products enter the closed loop of the new energy vehicle power battery industry.

Not only that, Sinorama Technology and its subsidiary Zhongli New Energy will also use the self-developed efficient active balanced battery management technology to solve the problem of service life attenuation of new energy vehicles after a certain period of operation. for the ground railway to provide a more cost-effective and reliable service recovery solution for operating vehicles, saving after-sales service costs and improving the operational efficiency of vehicles.

In addition, the two sides jointly discussed the establishment of a national comprehensive maintenance service network for automobile power batteries to provide comprehensive battery maintenance services for social vehicles while serving railway vehicles for self-use on the ground.

Guanghua Technology said that if the project in this cooperation agreement can be implemented smoothly, it will effectively enhance the company's development in the field of decommissioned power battery recycling and have a positive impact on the company's future business performance. However, considering that the cooperation framework agreement signed this time is only an intentional agreement, and there is uncertainty about specific cooperation projects and related matters, Sinorama Science and Technology also admitted frankly that there is a certain degree of uncertainty about the impact of this agreement on the company's future operating results and operating profits.

It is worth mentioning that this is not the first time Sinorama Technology has laid out the power battery recycling business this year. As early as February 22, 2022, Sinorama Technology also signed a "Strategic Cooperation Agreement" with Olympic New Energy and Panasonic China in Guangzhou to strengthen cooperation in battery banking, battery life cycle asset operation and management, battery life extension, power battery echelon energy storage and material recycling to promote the development of the tripartite business.

According to the content of the agreement, the three parties will cooperate at the technical, business and capital levels, respectively. At the technical level, the three parties will maintain close communication and cooperation on technology and data in the areas of battery condition detection, battery safety warning, battery life extension, battery echelon energy storage, etc.; at the business level, adhering to the concept of battery life cycle utilization, the three parties will strive to realize battery life cycle value mining, including battery asset operation and management, charging control strategy, echelon energy storage, scrap recycling. At the capital level, Panasonic discussed the possibility of cooperation between Sinorama Technology and the battery lifecycle utilization platform company being built by Sinorama Technology and Olympic New Energy within the scope of its business scope and group policy.

According to the results forecast released by Sinorama Technology for 2021, the company is expected to achieve a total net profit of 62 million yuan to 72 million yuan for shareholders of listed companies in 2021, an increase of 71.58% and 99.25% over the same period in 2020.

As we all know, the recent surge in nickel prices has pushed up the costs of battery recycling enterprises to a certain extent, and in response to this situation, Guanghua Technology replied that the company has a mature procurement and sales model to cope with material price fluctuations. The metal materials that can be extracted from the company's power battery recycling project include nickel, cobalt, manganese, lithium, etc., and the inventory in its recycling business is related to the company's production and sales arrangements.