EBSCN·2024-04-01 16:00Investment Rating - The report maintains a "Buy" rating for Tianqi Lithium Industries, Inc. (002466.SZ) [2][3] Core Views - The company's performance in 2023 was negatively impacted by falling lithium prices and increased minority shareholder losses, with a significant decline in net profit [1][2] - Despite the challenges, there are long-term expansion plans in the resource sector, with projected increases in lithium chemical production capacity [2][3] Financial Performance - In 2023, the company achieved operating revenue of CNY 40.503 billion, a slight increase of 0.13% year-on-year, while net profit attributable to shareholders was CNY 7.297 billion, down 69.75% year-on-year [1][3] - The fourth quarter of 2023 saw a net loss of CNY 800 million [1] - The company plans to increase its lithium compound production capacity to 143,800 tons per year through new projects [2][3] Market Conditions - The report highlights a downward adjustment in lithium production guidance from Greenbushes, indicating potential industry consolidation [1][2] - Global demand for lithium carbonate is projected at 1.259 million tons, with supply at 1.401 million tons, suggesting a potential price floor around CNY 75,600 per ton [1] Earnings Forecast - Due to recent declines in lithium prices, earnings per share (EPS) forecasts for 2024 and 2025 have been reduced to CNY 1.84 and CNY 2.64, respectively, with a new forecast for 2026 at CNY 3.44 [2][3] - The price-to-earnings (P/E) ratios for 2024-2026 are projected at 26X, 18X, and 14X [2][3] Production Capacity - As of the 2023 report, the company's lithium chemical production capacity reached 88,800 tons, with plans for further expansion [2][3] - The resource end, specifically the Talison lithium concentrate, is expected to reach a production capacity of 2.14 million tons per year after the commissioning of a new processing plant [2]