News summary

Focus on lithium battery anode materials for more than 20 yearsmegamillionsdrawingresults, performance will decline in 2023, but shipments will rank fourth in the country. Morocco's lithium battery anode material base construction plan aims to serve Europe and North America. Profitability is expected to recover in 2024 and is given a "buy" rating. Risks include market competition, raw material costs and changes in demand.

Newsletter text

[Lithium battery anode material companies face profit challenges]

A company has been deeply involved in the field of lithium battery anode materials for more than 20 yearsmegamillionsdrawingresultsof companies recently showed that their revenue and net profit fell 6.5 percent respectivelymegamillionsdrawingresults.64% and 88megamillionsdrawingresults.55%, mainly due to slowing demand growth and intensified market competition. Despite the challenges, the company's anode material product shipments increased by 20.11% year-on-year, and its market share reached 8.77%, ranking fourth in the country.

[Actively expand overseas markets and improve profitability]

The company plans to invest in an integrated base for lithium ion battery anode materials with an annual output of 100,000 tons in Morocco, with a total investment expected to not exceed 5 billion yuan. The move is aimed at responding to subsidies and tariff policies in Europe and the United States. It is expected that the first phase of production capacity in 2026 is expected to be achieved and serve the European and North American markets.

[Showing positive prospects and obtaining investment ratings]

According to forecasts, the company's parent net profit from 2024-2026 will be 340 million yuan, 546 million yuan and 748 million yuan respectively, and the corresponding earnings per share will be 0.47 yuan, 0.75 yuan and 1.03 yuan respectively. In view of the company's leading position in the industry and profit potential, it was rated as a "buy" level, with a target price set at 13.6 yuan.

[Risk factors need attention]

However, the continued deterioration of market competition, large fluctuations in raw material prices, lower-than-expected demand and potential changes in technical routes are all risk factors that investors need to consider.