GEM (002340): Performance in line with expectations in the future will continue to benefit from high nickel ternary material volume

GEM (002340): Performance in line with expectations in the future will continue to benefit from high nickel ternary material volume

Event: The company released its 2018 annual report and achieved operating income of 138 in 2018.

78 ‰, an increase of 29% in ten years; net profit attributable to mothers7.

US $ 300 million, an increase of 20% per year; net profit after deduction 6

5.7 billion, an annual increase of 8.


At the same time, the company issued a 2019 non-public stock issuance plan, and plans to raise no more than US $ 3 billion for green dismantling and recycling of power battery packs for vehicles and ternary power battery industry chain projects (including the 30,000 to be implemented by Jingmen GreenmyTonne / year ternary power battery material precursor production project, Fu’an Qingmei plans to implement a 5-contact power ternary material precursor material and 2 injection ternary alternative material project built in Ningde) ternary precursor, battery material sectorUsher in high growth.

The company’s new energy materials business segment achieved revenue of 79.

Six ten percent, 杭州桑拿 a year-on-year growth of 44%, with a gross profit margin of 22%.

The ternary precursor content in the battery material is 4 inches, of which single crystal series precursors and NCA high nickel precursors account for more than 75%. The mainstream supply is CATL supply. The mainstream international customers such as Samsung SDI and ECOPRO and Ningbo Rongbai, ZhenChina, Xiamen Tungsten and other domestic mainstream customers.

If the sales volume of battery-grade cobalt oxide exceeds 1 ton, the predetermined amount of subdivision materials is 7,000 tons. The company’s battery materials business accounts for nearly 60% of the company’s total revenue. It has become the company’s largest business segment and a stable growth of future company profits.point.
Open up the upstream cobalt and nickel resource channels and establish the source of high nickel ternary materials.

The company signed the “Project on the Construction of Indonesian Laterite Nickel Ore to Produce Battery-grade Nickel Sulfate (5 Nickel / Year)” with Qingshan Industrial, CATL, Bangpu, IMIP, and Japan’s Hanwa Industrial Co., Ltd. This project uses laterite nickel ore as the raw material for independent research and developmentLaterite nickel ore beneficiation technology and smelting technology to prepare advanced nickel sulfate crystals.

At the same time, the company also established stable supply relations with cobalt giants and international giants such as Glencore, MCC Ruimu and Toke to ensure the strategic supply of cobalt and nickel raw materials.

Suppliers of deeply bound high-nickel ternary materials will continue to benefit from the volume of high-nickel ternary materials in the future.

The company conquered the core technology of high-nickel ternary precursors (NCM811 & NCA) and single crystal ternary precursors and industrialized on a large scale, and signed a strategic supply agreement with the international mainstream ternary material supplier Korea ECOPRO for the next 5 years, andSigned a three-year ternary material strategic cooperation framework agreement with a domestic high nickel ternary material leader.

High nickelization of ternary materials will be the future development direction, and the company’s ternary precursor business will continue to benefit.

Profit forecast and rating.

We expect the EPS for 2019-2021 to be 0.

25 yuan, 0.

30 yuan and 0.

35 yuan, corresponding to PE, 20 times, 17 times and 15 times, maintaining the “buy” level.

Risk reminder: the release of production capacity may not meet the expected risks, and the risks that the procurement framework contract cannot avoid.