Yongxing Materials (002756) Company Review: Guaranteed Raw Material Supply Lithium Power Project Expected to Generate Considerable Revenue

Yongxing Materials (002756) Company Review: Guaranteed Raw Material Supply Lithium Power Project Expected to Generate Considerable Revenue

Event On December 9, 2019, Yongxing Materials issued an announcement that the subsidiary Jiangxi Yongxing Special Steel New Energy Technology Co., Ltd. signed an investment agreement with Yichun Mining and Huaqiao Mining.

After the equity change according to the investment agreement, Huaqiao Mining will become a wholly-owned subsidiary of Huaqiao Yongtuo, and Huaqiao Mining’s Mining License will be held by the company’s subsidiary Yongxing New Energy.

Yongxing New Energy is a wholly-owned subsidiary of Yongxing Materials and will consolidate the company’s consolidated statements in the future.

  This agreement guarantees the company’s raw material supply and helps the company form a complete new energy lithium phosphate industrial chain. According to the “Verification Report on Porcelain Ore Resources in Huashan Mining Area, Yifeng County, Jiangxi Province”, as of April 30, 2019, Huashan Porcelain MineThe ore body gradually identified the controlled internal economic resources and the preliminary internal economic resources. The total amount of ore was 4,507.

30 Quartz, mineral components include quartz, muscovite, iron-lithium mica, etc., which provides the company with sufficient raw materials to replace the production of new energy lithium battery projects.

In addition, after the investment agreement was signed, the company completed the complete new energy lithium battery industry chain from the mining of mineral resources to the production of brine to the preparation of battery-grade lithium carbonate. The product cost is controllable and the advantages are obvious, which will contribute to the company’s sustainable development and core competitiveness.Have a positive impact.

  The future of the lithium carbonate project is good, and it is expected to gradually realize the electric vehicle revolution and the upcoming new energy revolution that will bring considerable benefits to the company, driving demand for millions of tons of battery-grade lithium carbonate.Reached 102%.

The demand for battery-level lithium carbonate may continue in the future.

After the company owns the mining rights of porcelain stone ore, the company’s new lithium carbonate production line has a stable source of raw materials.

According to the company’s investor relations activities summary, the 北京夜生活 company’s annual production of 1 battery-grade lithium carbonate project is divided into two production lines, each production line is designed to produce 5,000 tons, of which # 1 production line has entered the continuous production stage.

The investment agreement paved the way for the company’s later development of new energy lithium battery projects, and the company’s profitability was gradually improved.

  Investment advice The company’s asset-liability ratio is reduced, and its asset position is better.

After the lithium carbonate project is put into production, it may contribute to the company’s profit in the future.

Therefore, we will the company’s EPS from 2019-2021.

16 yuan / share, 1.

47 yuan / share, 1.

49 yuan / share is raised to 1.

30 yuan / share, 1.

57 yuan / share, 1.

79 yuan / share, maintain “Buy” rating.

  Risk warning: the rise in raw material prices has compressed the company’s traditional special steel profits, the lithium carbonate project has been put into operation less than expected, and the decline in demand for traditional special steel and lithium carbonate has adversely affected the company.