After the continuous 20CM trading limit, the performance of the hottest lithium electric stocks plummeted! Profits depend solely on government subsidies?

July 23 news, yesterday, the lithium plate rose again, among which, Kuwo Hi-Tech rose by 20% for two consecutive days, becoming the prettiest kid in the lithium plate. From the beginning of July to yesterday's close, the share price has risen 128.13%, including four 20CM limit.

However, last night, Jiuwo Hi-Tech disclosed a forecast of results for the first half of 2021, with an estimated net profit of 8.5 million yuan to 12 million yuan, down 59.53% 42.86% from the same period last year. This is undoubtedly a big negative for Kuwo Hi-Tech, whose share price doubled within a month.

As for the main reasons for the changes in performance, Jiuwo Tech mentioned in the announcement that the amount of government subsidies received decreased significantly compared with the same period last year, at the same time, due to changes in raw material prices and low gross profit margins of demonstration projects in some new areas, the comprehensive gross profit margin decreased compared with the same period last year, resulting in a decline in net profit belonging to listed shareholders in the reporting period.

Judging from the government subsidies received by Jiuwu Hi-Tech last year, the total amount of government subsidies received in the first half of 2020 totaled 14187145.35 yuan, while the company's net profit in the first half of last year was 21.0007 million yuan, and government subsidies accounted for more than 2/3 of the net profit.

In addition, Jiuwo Hi-Tech announced that investors have paid more attention to the company's lithium extraction technology-related business recently, which accounts for a small proportion of the company's operating income in 2020 and the first quarter of 2021. The company's "adsorption + membrane method" technology has not been verified by large-scale industrialization, and there is a long process from small-scale test, pilot-scale test to industrial application. The lithium extraction processes of different salt lake brines are different in different degrees, and the single technology does not have complete applicability. At the same time, the price fluctuation of lithium products may restrain the investment and construction demand of downstream customers, which will adversely affect the development of the company's business. in the future, there is great uncertainty about whether the company can obtain orders for large-scale industrial application projects and the impact of lithium extraction technology-related business on the company's future operating performance, so investors are requested to make careful decisions and pay attention to investment risks.

Although Jiuwo Hi-Tech announced a forecast of declining performance in the first half of the year, from the perspective of the entire lithium sector, most enterprises are happy about their performance. Prior to this, Ganfeng Lithium and Tianqi Lithium have revised up their performance forecasts for the first half of the year, and their stock prices have also hit record highs recently.

For lithium electricity plate, Citic Securities said that downstream demand strong growth, lithium carbonate prices rise again, the plate heat continues. From the fundamental analysis of supply and demand, it is expected that the upward cycle of lithium prices will last at least more than a year, and the price rise is expected to continue to rise as downstream demand continues to exceed expectations. The high certainty and long-term growth of the lithium sector is expected to attract continued inflows of capital, pushing the company's share price upward.