Xin Lang Cai Jing·2025-09-04 06:45Core Viewpoint - Tianqi Lithium's H1 2025 financial results show a revenue of 4.833 billion yuan, a year-on-year decrease of 24.71%, while net profit attributable to shareholders reached 84.41 million yuan, reflecting a significant increase of 101.62% year-on-year. The company anticipates a recovery in performance in the second half of the year due to recent increases in lithium carbonate prices [1] Financial Performance - In H1 2025, the company's gross margin was 39.73%, down 12.08 percentage points year-on-year. The Q2 gross margin was 34.46%, a decrease of 9.86 percentage points quarter-on-quarter, primarily due to falling prices of lithium carbonate and spodumene [2] - The average price of lithium carbonate in Q2 was 65,300 yuan per ton, down 13.92% quarter-on-quarter, while the average price of spodumene was 713.6 USD per ton, down 14.5% [2] - The company's total expenses for H1 were 23 million yuan, with an expense ratio of 0.48%, down 8.00 percentage points year-on-year. Financial expenses turned negative at -268 million yuan due to foreign exchange losses [2] Market Dynamics - Recent disruptions in lithium resource supply have led to an increase in lithium prices. Notable disruptions include the suspension of production at the salt lake owned by Zangge Mining and the Yichun mine operated by CATL [3] - The combined production capacity of the suspended projects is significant, which is expected to impact domestic lithium supply and support an increase in lithium carbonate prices to around 80,000 yuan per ton [3] Project Developments - The CGP3 project is expected to commence production by the end of 2025, with a planned capacity of 520,000 tons per year. The company has already established lithium concentrate production capacity of 1.62 million tons per year [4] - As of June 2025, the company has built lithium chemical product capacity of approximately 91,600 tons per year, with a new lithium hydroxide project in Jiangsu having completed construction and entered trial operation [4][5] Profit Forecast and Valuation - The company is expected to see a significant recovery in performance in the second half of the year, with projected net profits for 2025-2027 being 1.791 billion, 2.827 billion, and 3.553 billion yuan, respectively [6] - The estimated EPS for the same period is 1.09, 1.72, and 2.16 yuan, with a projected PB of 1.53 times for 2025. Given the company's leading position in the industry and upcoming expansion projects, a target price of 47.92/44.18 HKD is maintained [6]