Ganfeng Lithium Industry: 130 million US dollars acquisition of Dutch SPV 50% equity exchange and mining rights change has been completed

SMM March 30th: Ganfeng Lithium Industry announced on the evening of March 29th that the company recently received notice from Ganfeng International that the Dutch SPV company MaliLithiumB.V. (hereinafter referred to as "Marion Lithium") has been officially established, and Ganfeng International now holds a 50% stake in Mali Lithium Industry. The transfer of the Goulamina spodumene mining license to a wholly owned subsidiary of Malian Lithium has been completed recently, and the change of equity and mining rights involved in the exchange has been successfully completed.

It is reported that according to the feasibility study report, the first phase capacity planning of the Goulamina spodumene project has been updated to produce 506000 dry tons of lithium concentrate per year, while the project plans to put into production the second phase within 18 months after the first phase capacity reaches production, and is expected to increase the original production capacity to 831000 dry tons of 6 per cent lithium concentrate per year.

As early as June 11, 2021, Ganfeng Lithium Industry examined and passed the "proposal on Ganfeng International's acquisition of 50% equity interest in Dutch SPV company involving mining rights investment and providing financial assistance to its wholly-owned subsidiary LMSA", and agreed that Ganfeng International, a wholly-owned subsidiary, should acquire 50% equity interest in Dutch SPV company with its own capital of US $130 million.

Recently, on the interactive platform, Ganfeng Lithium Industry also answered a number of investors' questions about the layout of the company's lithium mine, which mentioned that the company's Cauchari-Olaroz Salt Lake in Argentina plans to put into production a 40, 000-ton battery-grade lithium carbonate project in the second half of this year. And in response to the problem that the layout of overseas lithium mines may be difficult due to political risks, Ganfeng Lithium Industry said that the company has dispersed foreign political risks by distributing high-quality lithium resources in Australia, Argentina, Mexico and Africa.

In response to the problems of the Mahon Phase IV project, which is of considerable concern to the market, Ganfeng Lithium Industry said that the production time of the project has yet to be determined, and the remaining 10,000 tons of lithium hydroxide capacity will be met when the project is completed.

It is reported that Ganfeng Lithium Industry currently has an annual production capacity of 43000 tons of lithium carbonate, of which 15000 tons are used to produce lithium hydroxide; the company's total lithium hydroxide production capacity is 81000 tons, which is limited by back-end supporting products, and the current effective capacity is about 70, 000 tons. After Mahone Phase IV is put into production, the remaining lithium hydroxide capacity will be released.

Recently, many lithium industry chain enterprises have released their 2021 results, and even some enterprises have made forecasts for the company's performance in January and February 2022. Among them, Ganfeng lithium industry, as a well-known lithium mining giant in China, made a lot of money in 2021 under the background of the sharp rise in lithium prices. According to the announcement, the company achieved a total revenue of 11.162 billion yuan in 2021, an increase of 102.07 percent over the same period last year, while the net profit belonging to shareholders of listed companies was 5.175 billion yuan, up 405.03 percent from the same period last year.

Referring to the reasons for the performance growth, Ganfeng Lithium Industry said that on the one hand, with the rapid development of new energy vehicles and energy storage industry, downstream customers' demand for lithium products is growing strongly. The company's production and sales volume of lithium products increased in 2021, and the average product sales price increased significantly compared with 2020. The company's new lithium battery plate projects have been put into production one after another, and the production capacity has been gradually released. In addition, the increase in the fair value change income of the company's financial assets such as Pilbara is also a major reason for the company's performance growth compared with the same period last year. "View details

The performance of Ganfeng lithium industry is even more eye-catching in 2022. According to its previous disclosure, the company has a stable operation from January to February in 2022, product prices have further risen, and sales have increased compared with the same period last year. After preliminary calculation, the company is expected to achieve a total revenue of 3.6 billion yuan in the first two months of 2022, an increase of about 260% over the same period last year; the net profit belonging to shareholders of listed companies is about 1.4 billion yuan, an increase of about 300% over the same period last year.

However, recently, under the heavy attack of the Ministry of Industry and Information Technology and other departments on ensuring the supply and stable price of lithium resources, the price trend of lithium carbonate has stabilized, so can the fundamentals support the performance of lithium prices?

According to the latest research by SMM, the supply side of lithium salt has increased significantly since March, and the supply of lithium salt in April is expected to rise slightly from March. On the demand side, there was no obvious increase in the total output of cathode materials downstream in April, showing a flat or small increase as a whole. Under the joint action, the gap between supply and demand may gradually narrow, and is close to a tight balance in April. At the same time, the wait-and-see mood of each link of the industrial chain is increasing, and the game state is still continuing.

For the future trend of lithium carbonate prices, SMM believes that lithium carbonate prices are expected to change in the near future downstream month-end mining preparation, the price still has a certain correction risk. "View details

As of March 29, according to the spot price of SMM, the average spot price of domestic battery-grade lithium carbonate was 503000 yuan / ton, which has been stable since March 16.

"Click to order to view the spot historical price of SMM new energy products.