Core Viewpoint - The gold and non-ferrous metal sectors experienced a significant decline at the beginning of trading on October 10, with multiple companies in these sectors reporting substantial drops in their stock prices [1]. Group 1: Gold Sector - Xiaocheng Technology saw a decline of over 7%, trading at 28.13 [2] - Western Gold fell by over 6%, with a current price of 30.65 [2] - Other notable declines include Chifeng Gold down by 5.30% at 30.40, Shandong Gold down by 4.09% at 41.49, and Hunan Gold down by 3.81% at 22.73 [2][3]. Group 2: Non-Ferrous Metal Sector - Companies such as Huayou Cobalt, Tengyuan Cobalt, and Hanrui Cobalt all experienced declines, indicating a broader downturn in the non-ferrous metal market [1]. - Specific declines include Huayou Cobalt down by 5.68% at 66.30, Tengyuan Cobalt down by 5.37% at 76.78, and Tianqi Lithium down by 2.79% at 49.90 [3].

Group 1 - The gold and non-ferrous metal sectors experienced a significant decline on October 10, with many companies in these sectors reporting losses [1] - Notable declines in the gold sector included Xiaocheng Technology down 7.13% to 28.13, Western Gold down 6.81% to 30.65, and Chifeng Gold down 5.30% to 30.40 [2] - In the non-ferrous metal sector, companies such as Huayou Cobalt, Tengyuan Cobalt, and Tianqi Lithium also saw collective declines [3] Group 2 - The overall market sentiment for gold and related companies appears negative, as multiple firms reported losses exceeding 4% [2][3] - The decline in stock prices indicates potential challenges within the gold and non-ferrous metal industries, reflecting broader market trends [1][2]

Report Investment Rating - No investment rating information is provided in the report. Core Viewpoint - The short - term lithium carbonate market may continue the low - level oscillation pattern. The release of new supply - side production capacity and high existing operating rates exert downward pressure, while the growth of new energy vehicle sales and the rebound of lithium hexafluorophosphate prices on the demand side provide bottom support. The strengthening of the basis reflects a marginal relief of spot pressure, but warehouse receipt pressure still exists. In the next 1 - 2 weeks, attention should be paid to the post - holiday restocking rhythm, the ramping - up speed of new salt - lake production capacity, and the follow - up information of 8 lithium mines in Jiangxi [3]. Summary by Directory 1. Daily Market Summary - **Carbonate Lithium Futures Market Data Changes**: On September 30, the main lithium carbonate contract closed at 72,800 yuan/ton, down 1.52% from the previous trading day. The basis strengthened significantly, rising from - 820 yuan/ton to 300 yuan/ton. The main contract's open interest decreased by 7.86% to 232,000 lots, and the trading volume shrank significantly by 31.82% to 317,000 lots [1]. - **Analysis of Industrial Chain Supply - Demand and Inventory Changes**: On the supply side, the prices of spodumene and lepidolite concentrates remained stable, but the production capacity of leading enterprises was accelerating. Tianqi Lithium's 30,000 - ton lithium hydroxide project in Zhangjiagang and Tibet Mining's 10,000 - ton lithium carbonate project in Zabuye Salt Lake were put into operation, increasing supply - side pressure. On the demand side, the retail end of new energy vehicles remained resilient. From September 1 - 27, 1.039 million new energy vehicles were retailed and 1.154 million were wholesaled. The price of lithium hexafluorophosphate rose by 4.98% to 63,250 yuan/ton, and the price of ternary materials increased slightly, indicating marginal improvement in cathode material demand. However, the price of iron - lithium battery cells remained flat, showing structural differentiation. Carbonate lithium inventory decreased for four consecutive weeks, with 136,825 physical tons on September 30, and the slow destocking speed restricted the price rebound momentum [2]. - **Market Summary**: The short - term lithium carbonate market may continue the low - level oscillation pattern. The new supply - side production capacity and high existing operating rates suppress prices, while the growth of new energy vehicle sales and the rebound of lithium hexafluorophosphate prices on the demand side provide bottom support. The strengthening of the basis reflects a marginal relief of spot pressure, but warehouse receipt pressure still exists. In the next 1 - 2 weeks, attention should be paid to the post - holiday restocking rhythm, the ramping - up speed of new salt - lake production capacity, and the follow - up information of 8 lithium mines in Jiangxi [3]. 2. Industrial Chain Price Monitoring | Product | September 30, 2025 | September 29, 2025 | Change | Change Rate | Unit | | --- | --- | --- | --- | --- | --- | | Lithium carbonate main contract | 72,800 | 73,920 | - 1,120 | - 1.52% | yuan/ton | | Basis | 300 | - 820 | 1,120 | 136.59% | yuan/ton | | Main contract open interest | 231,964 | 251,749 | - 19,785 | - 7.86% | lots | | Main contract trading volume | 317,458 | 465,591 | - 148,133 | - 31.82% | lots | | Battery - grade lithium carbonate market price | 73,100 | 73,100 | 0 | 0.00% | yuan/ton | | Spodumene concentrate market price | 6,390 | 6,390 | 0 | 0.00% | yuan/ton | | Lepidolite concentrate market price | 3,400 | 3,400 | 0 | 0.00% | yuan/ton | | Lithium hexafluorophosphate | 63,250 | 60,250 | 3,000 | 4.98% | yuan/ton | | Power ternary material | 122,350 | 121,750 | 600 | 0.49% | yuan/ton | | Power lithium iron phosphate | 33,640 | 33,640 | 0 | 0.00% | yuan/ton | | Product | September 26, 2025 | September 19, 2025 | Change | Change Rate | Unit | | --- | --- | --- | --- | --- | --- | | Lithium carbonate capacity utilization rate | 71.31% | 71.31% | 0.00% | 0.00% | % | | Lithium carbonate inventory | 136,825 | 137,531 | - 706 | - 0.51% | physical tons | | 523 cylindrical ternary battery cell | 4.42 | 4.42 | 0.00 | 0.00% | yuan/piece | | 523 square ternary battery cell | 0.40 | - | 0.00 | 0.51% | yuan/Wh | | 523 soft - pack ternary battery cell | 0.41 | 0.41 | 0.00 | 0.00% | yuan/Wh | | Square lithium iron phosphate battery cell | 0.33 | 0.33 | 0.00 | 0.00% | yuan/Wh | | Cobalt - acid lithium battery cell | 6.65 | 6.35 | 0.30 | 4.72% | yuan/Ah | [5] 3. Industry Dynamics and Interpretation - **Spot Market Quotations**: On September 30, the SMM battery - grade lithium carbonate index price was 73,488 yuan/ton, up 32 yuan/ton from the previous working day. The battery - grade lithium carbonate was priced at 72,800 - 74,300 yuan/ton, with an average of 73,550 yuan/ton, unchanged from the previous working day. The industrial - grade lithium carbonate was priced at 70,700 - 71,900 yuan/ton, with an average of 71,300 yuan/ton, unchanged from the previous working day. The lithium carbonate futures price continued to oscillate, with the main contract oscillating between 72,700 - 74,000 yuan/ton. The downstream material factories' National Day stockpiling was basically completed, and market transactions became significantly lighter. In terms of supply, lithium carbonate produced from spodumene accounted for over 60% of the market supply, while that from lepidolite decreased to 15%. Overall, the September market showed simultaneous growth in supply and demand, but the demand growth rate was faster, resulting in a temporary supply shortage [6]. - **Downstream Consumption**: According to the Passenger Car Association data, from September 1 - 27, the retail volume of the national passenger - vehicle new energy market was 1.039 million, a 9% year - on - year increase compared to the same period in September last year and a 17% increase compared to the same period last month. The retail penetration rate of national passenger - vehicle new energy was 58.5%, and the cumulative retail volume this year was 8.609 million, a 24% year - on - year increase. From September 1 - 27, the wholesale volume of national passenger - vehicle manufacturers' new energy was 1.154 million, a 12% year - on - year increase compared to the same period in September last year and a 21% increase compared to the same period last month. The wholesale penetration rate of national passenger - vehicle manufacturers' new energy was 54.9%, and the cumulative wholesale volume this year was 10.098 million, a 31% year - on - year increase [7]. - **Industry News**: - On September 28, news showed that on September 20, EVE Energy's Hungary base reached a new milestone with the official entry of electromechanical equipment, marking the key stage of the project's civil engineering. The base is expected to supply large cylindrical batteries to BMW Group's Debrecen plant after completion in 2026, creating about 1,000 jobs [8][9]. - On September 26, news from "Zhangjiagang Release" showed that on September 25, Tianqi Lithium's 30,000 - ton battery - grade lithium hydroxide project in Zhangjiagang Free Trade Zone, Jiangsu, with a total investment of about 1.8 billion yuan, was completed and put into operation. Tianqi Lithium is a globally leading new - energy materials enterprise focusing on lithium, with 5 production bases globally, and its Zhangjiagang base has an annual production capacity of 20,000 tons of battery - grade lithium carbonate [9]. - On September 26, Tibet Mining's 10,000 - ton lithium carbonate project at the Zabuye Salt Lake, which had been in the works for four years, was officially put into operation. The project passed a 120 - hour functional assessment from September 20 - 24, 2025. The project's production capacity release is expected to significantly improve China's lithium - resource self - sufficiency rate. The company has the exclusive mining right for the Zabuye Salt Lake, which is one of the world's three largest and Asia's largest lithium - rich salt lakes [9][10]. 4. Industrial Chain Data Charts - The report provides multiple data charts, including those on the main lithium carbonate futures and basis, battery - grade and industrial - grade lithium carbonate prices, lithium concentrate prices, lithium hexafluorophosphate and electrolyte prices, ternary precursor prices, ternary material prices, lithium iron phosphate prices, lithium carbonate operating rate, lithium carbonate inventory, and battery cell selling prices [11][14][15].

Core Insights - The Chinese Ministry of Commerce announced export controls on rare earth-related technologies to safeguard national security and interests, effective October 9, 2025 [1] - The rare metal ETF index (930632) surged by 6.23% as of October 9, 2025, with significant gains in constituent stocks such as Western Superconducting (up 18.79%) and Ganfeng Lithium (up 9.15%) [1] - The rare metal ETF fund (561800) has seen a cumulative increase of 10.36% over the past two weeks, ranking first among comparable funds [1][3] Industry Performance - As of September 30, 2025, the rare metal ETF fund recorded a highest monthly return of 24.02% since its inception, with an average monthly return of 8.58% during rising months [3] - The rare earth prices, particularly for praseodymium and neodymium oxides, are expected to remain high, contributing to strong performance in the rare earth industry in the second half of the year [3] - The supply-demand dynamics in the rare earth sector are improving, with domestic supply growth lagging behind demand expansion due to regulatory measures on mining and separation [3] - Demand is driven by industries such as robotics, low-altitude economy, and military applications, while high refining costs abroad support price expectations [3] Key Stocks - The top ten weighted stocks in the rare metal index include Northern Rare Earth, Luoyang Molybdenum, and Ganfeng Lithium, collectively accounting for 59.91% of the index [4][5] - Notable stock performances include Salt Lake Co. (up 6.76%), Northern Rare Earth (up 7.31%), and Luoyang Molybdenum (up 9.04%) [7]

Group 1 - The China Securities New Energy Vehicle Industry Index (930997) has seen a strong increase of 3.73% as of October 9, 2025, with notable gains from companies such as Dongsheng Technology (300073) up 11.76%, Ganfeng Lithium (002460) up 10.00%, and Tianqi Lithium (002466) up 9.31% [1] - The New Energy Vehicle ETF (515700) has risen by 3.63%, marking its third consecutive increase, with the latest price reported at 2.63 yuan. Over the past two weeks, the ETF has accumulated a rise of 6.92% [1] - The New Energy Vehicle ETF closely tracks the China Securities New Energy Vehicle Industry Index, which includes 50 listed companies involved in various sectors of the new energy vehicle industry, reflecting the overall performance of leading companies in this sector [1] Group 2 - As of September 30, 2025, the top ten weighted stocks in the China Securities New Energy Vehicle Industry Index include CATL (300750), Huichuan Technology (300124), BYD (002594), and others, collectively accounting for 54.61% of the index [2] - The weightings of the top stocks are as follows: CATL at 9.80%, Huichuan Technology at 9.63%, BYD at 9.10%, and Changan Automobile (000625) at 5.08% [4]

Core Viewpoint - The lithium mining and lithium extraction from salt lake sectors are experiencing a strong upward trend, with significant stock price increases for key companies in the industry [1] Company Performance - Ganfeng Lithium has reached its daily price limit increase [1] - Tianqi Lithium has seen a stock price increase of over 8% [1] - Other companies such as Luoyang Molybdenum, Salt Lake Industry, and Huayou Cobalt have also experienced stock price increases [1]

Market Overview - In Q2 2025, lithium resource clearing was below expectations, with lithium prices continuing to decline to 60,000 yuan/ton [2] - The growth rate of lithium salt production in China slowed down in Q2 2025 [2] - Due to weak demand, social inventory of lithium salt remained high at over 150,000 tons [2] Company Performance - In Q2 2025, listed companies increased revenue by 3% year-on-year by compensating volume for price [3] - Net profit attributable to shareholders decreased by 9% year-on-year due to reduced gross profit and inventory impairment losses [3] - Gross and net profit margins were reported at 22.36% and 9.13%, respectively, indicating a reversal trend [3] - Financial expenses decreased in 2024, while management and sales expenses have limited room for reduction [3] - Capital expenditures remained at a cyclical low [3] - Debt repayment capability remained stable and within a reasonable range [3] Industry Changes - Chinese companies showed a very low willingness to reduce production, with lithium prices dropping from 74,000 yuan/ton to 60,000 yuan/ton, further compressing profit margins [4] - Some companies reported net losses, such as Shengxin Lithium Energy with a net loss of 165 million yuan and Zhongmin (Hong Kong) with a net loss of 210 million yuan in H1 2025 [4] - Despite some companies experiencing losses, their debt repayment capabilities remained relatively stable, with overall leverage still in a safe zone [4] - Capital expenditures have slowed down, with total capital expenditure for sample companies at 4.1 billion yuan, a year-on-year decrease of 8.0%, indicating that the lithium cycle turning point is approaching [5]

Investment Rating - The industry investment rating is "Positive" [4] Core Viewpoints - The lithium mining industry is experiencing a gradual stabilization after a period of clearing out excess inventory, with signs of a cyclical turning point approaching [2][3] - The report highlights that the performance of listed lithium companies is under pressure due to declining lithium prices and increased inventory levels, but there are indications of potential recovery in the second half of 2025 [8][10] Market Analysis - Lithium prices fell to 60,000 yuan/ton in Q2 2025, down from 74,000 yuan/ton, reflecting a continued downward trend due to oversupply [10] - The production growth rate of lithium salts in China slowed, with Q2 2025 production at 299,000 tons, a year-on-year increase of 4% [11] - Social inventory of lithium salts remained high at over 150,000 tons due to weak demand [16] Company Performance - The total operating revenue of the 12 listed lithium companies reached 35.36 billion yuan in Q2 2025, a year-on-year increase of 3% [21] - The net profit attributable to shareholders decreased by 9% year-on-year to 3.227 billion yuan in Q2 2025, impacted by reduced gross profit and inventory impairment losses [25] - The gross margin for the companies was 22.36%, showing a reversal trend, while the net margin was 9.13% [33][36] Financial Metrics - The total expenses for the 12 companies amounted to 2.287 billion yuan in Q2 2025, a decrease of 16.3% year-on-year [40] - Capital expenditures for the companies totaled 11.5 billion yuan in H1 2025, indicating a slowdown in investment as the industry approaches a cyclical bottom [53] - The debt repayment capability remains stable, with an average cash ratio of 0.64 and a debt-to-asset ratio of 26.25% [61][62]

Summary of Key Points from the Conference Call Industry Overview - The conference call focuses on the **Global Energy Storage** industry, particularly the **electricity demand and supply dynamics in China**. [1][10] Key Insights and Arguments 1. **Electricity Demand Growth**: - China's power demand surpassed **1,000 TWh** last month, with annual demand reaching approximately **10,000 TWh** last year, projected to grow to **13,500 TWh by 2030** and **25,000 TWh by 2050**. This growth is driven by sectors such as AI, EVs, air conditioning, and high-tech manufacturing automation. [1][10] - Expected **CAGR** for electricity demand is **5.6%** through 2030 and **3.2%** through 2050, outpacing GDP growth. By 2050, electricity will account for over **50%** of final energy consumption. [1][10] 2. **Renewable Energy Capacity**: - China is positioned to add over **500 GW** of power capacity annually, having added over **400 GW** last year, which accounted for **70%** of global power capacity additions. [1][10] - Solar and wind power generation could increase **10x** to **18,000 TWh** by 2050 at current installation rates, with expectations for solar and wind to account for **70%** of power generation by 2050. [2] 3. **Energy Storage Needs**: - With rising renewable penetration, China will require **3,300 GW** or approximately **12,000 GWh (12 TWh)** of installed energy storage capacity, representing a **30x** increase from current levels. [3] 4. **Grid Infrastructure Investment**: - Significant investment in grid infrastructure is necessary to match demand with renewable power supply, particularly in central and western China. Investment in grid infrastructure reached **RMB 600 billion** last year, growing by **15%** year-over-year. [4] 5. **Nuclear Power's Role**: - Nuclear power is expected to play a significant role as a baseload alternative to coal, with investment growing by **42%** last year to **RMB 142 billion**. However, it is projected to remain less than **10%** of the power generation mix. [5] 6. **Fossil Fuels Outlook**: - Coal and oil are expected to decline as China electrifies its economy, with coal-fired power generation declining by **2.5%** in the first half of 2025. Oil consumption is likely to peak before 2030 due to the growth of EVs. [6] Additional Important Insights - The rise of AI and EVs is significantly increasing power demand, with electricity consumption growth expected to continue outpacing GDP growth. [10] - The electrification ratio in China is projected to rise to **35%** by 2030 and **55%** by 2050, driven by new sources of power demand such as data centers and EV charging. [18] - The power multiplier, which indicates the ratio of electricity consumption growth to GDP growth, is expected to increase from **1.3** to **1.4** over the next five years. [32] Investment Implications - Companies like **CATL** are highlighted as top picks due to their strategic positioning in the energy storage market, which is critical for supporting the growth of solar and wind energy. [10]

Summary of Conference Call Notes Industry Overview - **Industry**: New Materials in China - **Key Focus Areas**: Lithium, Uranium, Rare Earths, Solar Glass Key Points and Arguments Lithium Market - **Demand**: Year-to-date lithium demand has exceeded market expectations, driven by strong demand from Energy Storage Systems (ESS) and ongoing electric vehicle (EV) trade-in programs [2] - **Supply Risks**: Yichun lepidolite mines are undergoing resource reclassification, which may lead to temporary shutdowns. These mines collectively produce approximately 150,000 tons of Lithium Carbonate Equivalent (LCE) annually [2] - **Cost Dynamics**: The cost curve for lepidolite mines is expected to rise due to increased royalties and fees, with cost support estimated at around RMB 70,000 per ton [2] Uranium Market - **Price Momentum**: Strong momentum in uranium prices is anticipated, supported by major investment vehicles like SPUT and Yellow Cake purchasing in the spot market. Long-term prices are expected to rise post-World Nuclear Symposium, with current spot prices around US$83 per pound [3] - **Supply Adjustments**: Production cuts from Kazatomprom and Cameco highlight ongoing supply risks, benefiting CGN Mining, which has increased its spot price exposure to 70% from 60% due to a renewed three-year contract [3] Rare Earths and Magnets - **Price Strength**: Rare earth prices are robust due to strong downstream demand and China's supply-side controls. Magnet producers are expected to pass price increases to customers, improving gross profit margins [4] - **Export Recovery**: Export volumes for magnet producers are normalizing, with anticipated improvements in shipment volumes and earnings in the second half of the year [4] Solar Glass Market - **Demand Decline**: Demand for solar glass has softened in October and is expected to weaken further into winter, leading to inventory build-up and downward pressure on prices [5] - **Earnings Impact**: The anticipated decline in solar glass prices could negatively affect company earnings if no supply-side controls are implemented [5] Additional Insights - **Equity Ratings**: Various companies within the new materials sector have been rated with "Overweight" or "Equal-weight" based on their market positions and expected performance [10][11] - **Price Target Adjustments**: Price targets for several companies have been adjusted based on updated earnings forecasts and market conditions, reflecting changes in commodity prices and company performance [19][20] - **Market Sentiment**: The overall sentiment in the new materials sector remains attractive, with potential upside from uranium recovery and stable demand in rare earths, despite challenges in lithium and solar glass markets [1][7] Conclusion The new materials sector in China is experiencing mixed dynamics, with strong demand in lithium and uranium markets, while facing challenges in solar glass. Companies are adjusting their strategies and forecasts in response to evolving market conditions, highlighting the importance of monitoring supply risks and price movements in this sector.