Chengxin Lithium(SZ:002240) Minsheng Securities·2025-03-23 13:39Investment Rating - The report maintains a "Cautious Recommendation" rating for the company [6][4]. Core Views - The company reported a significant increase in its own mineral production, but impairment losses have negatively impacted its performance [2][3]. - The lithium concentrate production reached 286,000 tons in 2024, a year-on-year increase of 64.9% [2]. - The average price of battery-grade lithium carbonate in 2024 was 90,000 yuan, down 64.8% year-on-year, indicating a significant price drop due to industry oversupply [2]. - The company expects to see a gradual recovery in profitability from 2025 to 2027, with projected net profits of 226 million, 427 million, and 531 million yuan respectively [4]. Summary by Sections Financial Performance - In 2024, the company achieved revenue of 4.58 billion yuan, a decrease of 42.4% year-on-year, and a net loss attributable to shareholders of 622 million yuan, marking a shift from profit to loss [1][5]. - The gross profit margin for 2024 was 2.4%, down 10.1 percentage points year-on-year, primarily due to falling lithium prices [2][3]. Production and Capacity - The company has successfully increased its lithium concentrate production capacity, with the Sichuan Yelonggou mine producing approximately 75,000 tons and the Zimbabwe Sabi Star mine reaching a capacity of 290,000 tons [2][3]. - The company has also established a lithium salt production capacity of 137,000 tons and 500 tons of metallic lithium by the end of 2024 [2]. Future Outlook - The company anticipates a recovery in net profits starting in 2025, with projected earnings per share of 0.25 yuan in 2025, 0.47 yuan in 2026, and 0.58 yuan in 2027 [5][4]. - The report highlights the potential for increased profitability from the high-grade Muzhong lithium mine, which is expected to significantly enhance the company's integrated production capacity once operational [3][4].