[Power battery business performance differentiation, raw material business performance is excellent] China's power battery industry is developing at a high speed, related companies last year's performance has mixed concerns.
According to data from the Power Battery Application Branch of China Chemical and Physical Power Industry Association, in 2017, Ningde Times, BYD (002594.SZ), and Wultema ranked domestic installed capacity with 10.5Gwh, 5.65Gwh, and 2.41Gwh installed capacity, respectively. In the top three rankings, only the Ningde era accounted for 30% of the market share.
In addition, according to the data from the real lithium research institute, the top 20 companies in the total installed capacity accounted for 86% of the market share. Compared with 2016, the industry concentration dropped slightly.
In 2017, China's power battery production was 44.5GWh, a year-on-year increase of 44%. The installed capacity was approximately 36.24 Gwh, an increase of approximately 29.4% over the same period of last year.
In addition to traditional battery giants such as BYD, Lishen, BAK, etc., there are four new faces in the top ten companies in terms of power battery installed capacity in 2017—Fuengeng Technology, Beijing Guoneng, Yiwei Lithium Energy and Suzhou Xingheng. Quickly join the fierce competition of power batteries.
In terms of profits, the top ten battery companies exhibited polarization. In the Ningde era, net profit reached 4.288 billion yuan, a year-on-year increase of 38.8%. Wattmar's parent company, Warnevolen (300116.SZ), expects a loss of 3.68 billion yuan for the full year.
Since the profit of Waterma in 2017 did not reach expectations, and the gap between future profitability and expectation is relatively large, it can announce on April 19 that it will fully accrue goodwill from the acquisition of Wattmar. In 2016, the goodwill generated from this merger was 4.61 billion yuan.
According to the published annual report or performance report, there are also profits falling as well as BYD and Guoxuan Hi-Tech (002074.SZ).
Affected by the decline in new energy subsidies and the decline in sales of fuel vehicles, BYD's 2017 net profit was 4.07 billion yuan, a year-on-year decrease of 19.5%. In the first quarter of this year, it is estimated that net profit will still fall by 75.24%-91.75%.
Guoxuan Hi-tech Co., Ltd. announced in the announcement that due to the adjustment of the subsidy policy for new energy vehicles, the domestic power battery prices generally declined in 2017, while the price of upstream raw materials rose, affecting the overall profitability. The company is expected to achieve a net profit of 920 million yuan in 2017, a year-on-year decrease of 10.73%.
According to the data from the Institute of Lithium-Industrail Research (GGII), as of the end of 2017, the price of power batteries fell by 20%-25% from the beginning of the year. The price of lithium iron phosphate battery pack dropped from 1.8 yuan to 1.9 yuan/Wh at the beginning of the year to 1.45 to 1.55 yuan/Wh at the end of the year. Sanyuan Power Battery pack price dropped from 1.7-1.8 yuan/Wh at the beginning of the year to 1.4 yuan-1.5 yuan/Wh at the end of the year.
According to the objectives set forth by the Ministry of Industry and Information Technology in the "Mid-term and long-term development plan for the automotive industry," by 2020, the specific energy of new energy vehicle power battery systems will strive to reach 260 watt-hours/kilogram and the cost will drop below 1 yuan/watt-hour.
However, raw material prices did not fall back. According to statistics from the Everbright Securities Research Institute, due to an increase in electrolytic cobalt prices of over 100% in 2017, the price of lithium carbonate rose by more than 30%, and the cost of some types of ternary cathode materials even increased by nearly 50%. The price of anode materials also increased slightly.
According to GGII, the output value of the four key materials (positive electrode materials, negative electrode materials, separators, and electrolytes) of China's power batteries in 2017 was 61 billion yuan, a year-on-year increase of 62%. The output value of cathode material accounts for the largest proportion, accounting for 71.5%, and the output value of this material has the largest increase.
Affected by the year-on-year increase in cathode material business, Shanshan Electric (600884.SH), a lithium battery materials company, realized a net profit of 896 million yuan last year, an increase of 171.42% year-on-year. When Sheng Sheng Technology (300073.SZ) lithium battery business revenue of 1.92 billion yuan, an increase of 89.41%, sales volume growth of 21.73%. Driven by the lithium battery business, Ascension Technology achieved a net profit of RMB 250 million in 2017, an increase of 151.79% year-on-year.
Some upstream companies have also joined the ternary materials competition by expanding their industrial chain layout. At present, Huayou Cobalt (603799.SH) has a ternary anode material precursor production capacity of 20,000 tons/year at the Luzhou plant. This year, Huayou Cobalt also established a joint venture agreement with South Korea’s Pohang Iron and Steel and LG Chemicals to produce a precursor. Body and cathode materials. Xiamen Tungsten Industry (600549.SH) is also expanding the cathode material production capacity of 16,000 tons in Fujian and Sanming, and the designed capacity of 20,000 tons in Ningde.
Driven by the demand for power batteries and related lithium electricity, Lithium New Energy core material supplier Tianqi Lithium (002466.SZ) hit a record high in 2017, achieving revenue of 5.47 billion yuan and net profit of 2.15 billion yuan, a year-on-year increase. More than 40%. Fengfeng Lithium (002460.SZ) achieved a net profit of 1.469 billion yuan, a year-on-year increase of 216.36%.
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