1. Report Industry Investment Rating - The investment rating for the lithium carbonate industry is "Oscillation" [1] 2. Core Viewpoints of the Report - Last week, lithium salt prices stabilized and rebounded. The closing prices of LC2510 and LC2511 increased by 3.6% and 4.1% respectively. The spot average prices of battery - grade and industrial - grade lithium carbonate decreased by 0.3%. The price of lithium hydroxide slightly decreased. The inventory of lithium carbonate decreased, and the destocking rhythm accelerated, which supported the price and led to a rebound in the market [1][10][11] - In the future, the fundamentals of continuous destocking during the peak season support the price, but further upward momentum may depend on unexpected supply - side disturbances. Short - term attention should be paid to the sustainability of destocking and the volume and price in the spot market. In terms of strategies, short - term interval operations are recommended, and medium - term short - selling opportunities after the peak demand within the year are worth noting. For arbitrage, attention should be paid to the reverse arbitrage opportunity of LC2511 - LC2601 and the positive arbitrage opportunity of LC2601 against more distant contracts [2][12] 3. Summary According to the Directory 3.1. Destocking Acceleration and Warehouse Receipt Cancellation, Lithium Price Breaks through the Oscillation Range - Last week (10/13 - 10/17), lithium salt prices stabilized and rebounded. LC2510's closing price increased by 3.6% to 75,300 yuan/ton, and LC2511's increased by 4.1% to 75,700 yuan/ton. The spot average prices of battery - grade and industrial - grade lithium carbonate decreased by 0.3% to 73,400 and 71,100 yuan/ton respectively. The average prices of battery - grade lithium hydroxide decreased by 0.5%. The electric - industrial price difference remained flat at 2,250 yuan/ton, and the price discount of battery - grade lithium hydroxide to battery - grade lithium carbonate slightly widened to 270 yuan/ton [10][11] - Last week, warehouse receipts were continuously cancelled and taken out of storage, with a week - on - week reduction of 12,000 tons to 30,700 tons. The domestic lithium carbonate inventory decreased by 2,000 tons to 132,700 tons, and the destocking rhythm accelerated. The continuous improvement of explicit inventory data supported the price, and the market sentiment recovered [1][11] 3.2. Review of Weekly Industry News - Zangge Mining: Its subsidiary, Golmud Zangge Lithium Industry Co., Ltd., officially resumed production on October 11, 2025. The temporary shutdown lasted 87 days, and it is expected to have a small impact on the company's 2025 operating performance [13] - Beijing Easpring signed an MoU with AMG to purchase lithium hydroxide. The cooperation shows their commitment to building a local battery supply chain, and they will work together to ensure the certification of AMG's production base and negotiate a binding purchase agreement [13] - Hainan Mining's Mali Bugoni lithium ore project shipped its first batch of lithium concentrate products on October 14. 30,000 tons of lithium concentrate will be transported to Hainan Yangpu Port to provide raw materials for the company's lithium salt processing project [14] - Tianqi Lithium: The 30,000 - ton lithium hydroxide project in Zhangjiagang, Jiangsu, reached the battery - grade lithium hydroxide standard on October 17, 2025. The company will continue to optimize the project for continuous and stable production [14] 3.3. Monitoring of Key High - Frequency Data in the Industrial Chain 3.3.1. Resource End: Spot Quotes of Lithium Concentrate Remain Stable - The spot average price of lithium spodumene concentrate (6%, CIF China) was 846 US dollars/ton, with a week - on - week increase of 7 US dollars or 0.8% [11] 3.3.2. Lithium Salt: The Market Stabilizes and Rebounds - The closing prices of LC2510 and LC2511 increased by 3.6% and 4.1% respectively. The spot average prices of battery - grade and industrial - grade lithium carbonate decreased by 0.3%. The price of lithium hydroxide slightly decreased [10][11] 3.3.3. Downstream Intermediates: Quotes of Ternary and Lithium Cobaltate Surge - The spot average prices of ternary materials 523, 622, and 811 increased by 9.6%, 3.5%, and 2.3% respectively. The spot average price of lithium cobaltate increased by 14.6% [11] 3.3.4. Terminal: The Penetration Rate of New Energy Vehicles Reached 50% in September - In September, the penetration rate of new energy vehicles reached 50%, indicating strong demand in the terminal market [36]

Group 1 - The company reported total operating revenue of 4.833 billion yuan in H1 2025, a year-on-year decrease of 24.71% [1] - The net profit attributable to shareholders was 84 million yuan in H1 2025, a year-on-year increase of 101.62% [1] - The company achieved a net profit of 132 thousand yuan after deducting non-recurring gains and losses, a year-on-year increase of 100.03% [1] Group 2 - In Q2 2025, the company recorded operating revenue of 2.248 billion yuan, a quarter-on-quarter decrease of 12.99% [1] - The net profit attributable to shareholders in Q2 2025 was -20 million yuan, a quarter-on-quarter decrease of 119.05% [1] - The net profit after deducting non-recurring gains and losses in Q2 2025 was -43 million yuan, a quarter-on-quarter decrease of 197% [1] Group 3 - Lithium prices have been declining rapidly, increasing the company's profit pressure, with the average price of battery-grade lithium carbonate at 65,300 yuan per ton in Q2 2025, a quarter-on-quarter decrease of 14% [1] - Greenbush achieved a net profit of 1.742 billion yuan in H1 2025, with Tianqi's attributable net profit of 584 million yuan [1] - In Q2 2025, Greenbush's lithium concentrate production was 340,000 tons, remaining stable quarter-on-quarter, while sales increased by 12% to 412,000 tons [1] Group 4 - SQM reported a net profit of 1.621 billion yuan in H1 2025, with lithium salt sales of 108,100 tons [2] - In Q2 2025, SQM's lithium salt sales were 53,100 tons, with an average selling price of 8,384 USD per ton [2] - SQM's net profit in Q2 2025 was 88.4 million USD, a quarter-on-quarter decrease of 36% [2] Group 5 - The lithium salt smelting segment reported a loss of 530 million yuan in H1 2025, with Q2 2025 losses improving to approximately 244 million yuan [2] - The company has established lithium chemical product capacity of approximately 91,600 tons per year, with plans for a total capacity of 122,600 tons per year [2] - Non-recurring gains and losses included a provision for inventory impairment of 185 million yuan in H1 2025, with additional impairment of 164 million yuan in Q2 2025 due to falling lithium salt prices [3]

Group 1 - The domestic lithium carbonate futures market has experienced a significant decline, with the main contract (2511) opening at 69,000 yuan/ton and closing down 4.87% at 70,700 yuan/ton, approaching the limit down price of 68,400 yuan/ton [1] - Other lithium carbonate contracts also saw substantial price drops, indicating a broader market downturn [1] - Industry insiders suggest that the recent price movements may be an overreaction to news regarding CATL's resumption of production at the Jiangxiawo lithium mine, which is progressing faster than the previously expected 3-6 month downtime [1] Group 2 - CATL's resumption of production aims to expedite the reopening of the Jiangxiawo lithium mine, with mining rights and permits progressing smoothly [1] - There is uncertainty regarding CATL's production targets, leading to mixed interpretations of the news within the market [1] - It is anticipated that lithium carbonate spot prices will fluctuate within the range of 69,000 to 73,000 yuan/ton over the next month and a half [1]

Core Viewpoint - Tianqi Lithium's financial performance showed improvement in the first half of 2025, with a revenue of 4.833 billion yuan, a year-on-year decrease of 24.71%, but a net profit of 84 million yuan, successfully turning from a loss of 5.206 billion yuan in the same period last year to profit [3][5]. Financial Performance - The company's revenue decreased by nearly 25% year-on-year, while it achieved a net profit turnaround [5]. - In 2024, Tianqi Lithium reported a significant revenue drop of 67.75% to 13.063 billion yuan, with a net profit loss of 7.905 billion yuan, a year-on-year decline of 208.32% [5]. - The average market price for lithium carbonate and lithium hydroxide remained low, between 60,000 to 80,000 yuan per ton, contributing to the overall revenue decline [5][6]. Key Factors for Profitability - Tianqi Lithium attributed its ability to achieve profitability in a declining market to three main factors: 1. Shortened pricing cycles for its subsidiary's lithium products [6]. 2. Increased investment income from its joint venture SQM, contributing 235 million yuan to its earnings [6]. 3. A stronger Australian dollar against the US dollar, which positively impacted foreign exchange gains [6]. Asset Management - The company's asset impairment losses improved from a loss of 292 million yuan in the previous year to 185 million yuan [7]. - Tianqi Lithium is actively expanding production capacity, with a current lithium concentrate capacity of 1.62 million tons per year [7][8]. Production Capacity - The company has five operational lithium chemical product production bases with a total capacity of 91,600 tons per year, which will increase to 122,600 tons per year after the completion of projects in Jiangsu and Chongqing [9][10]. Leadership and Historical Context - The founder, Jiang Weiping, has seen his wealth decline significantly from 51.89 billion yuan in 2022 to 16 billion yuan in 2025 due to market fluctuations [4][24]. - Jiang Weiping stepped down as chairman in April 2022, passing leadership to his daughter, while still retaining control of the company [25][26]. Strategic Response - To combat the cyclical nature of lithium prices, Tianqi Lithium plans to enhance its resource and cost advantages, increase R&D investment, and strengthen collaboration across the lithium supply chain [26].

Investment Rating - The investment rating for the company is "Buy" (maintained) [1] Core Views - The company's performance in the first half of 2025 met expectations, with revenue of 3.27 billion yuan, a year-on-year decrease of 34.9%, and a net profit attributable to shareholders of 90 million yuan, down 81.2% year-on-year [7] - The company's cesium and rubidium business saw a significant profit increase, with a revenue of 710 million yuan in the first half of 2025, up 50% year-on-year [7] - The lithium price is expected to rebound in the second half of 2025, potentially contributing over 200 million yuan in profit [7] - The copper smelting business faced losses due to tight global copper concentrate supply, but is expected to reduce losses in the third quarter of 2025 [7] - The company has adjusted its profit forecasts for 2025-2027, expecting net profits of 670 million yuan, 1.28 billion yuan, and 2.15 billion yuan respectively [7] Financial Summary - Total revenue for 2023 is projected at 6,013 million yuan, with a year-on-year decrease of 25.22% [1] - The net profit attributable to shareholders for 2023 is estimated at 2,208.16 million yuan, down 32.98% year-on-year [1] - The earnings per share (EPS) for 2023 is projected at 3.06 yuan, with a price-to-earnings (P/E) ratio of 13.29 [1] - The company expects a total revenue of 7,016 million yuan in 2025, representing a year-on-year increase of 30.81% [1] - The projected net profit attributable to shareholders for 2025 is 670.67 million yuan, a decrease of 11.40% year-on-year [1] - The EPS for 2025 is expected to be 0.93 yuan, with a P/E ratio of 43.75 [1]

Report Summary 1. Report Industry Investment Rating No information is provided in the report regarding the industry investment rating. 2. Core Viewpoints - The weekly inventory of lithium carbonate has been depleted again, and the price is in a range - bound oscillation [1] - The trend strength of lithium carbonate is 0, indicating a neutral stance [4] 3. Summary by Relevant Catalogs 3.1 Fundamental Tracking - **2509 Contract**: The closing price is 81,040, down 6,540 compared to T - 1; the trading volume is 55,748, up 27,298 compared to T - 1; the open interest is 65,157, down 11,043 compared to T - 1 [2] - **2511 Contract**: The closing price is 80,980, down 6,560 compared to T - 1; the trading volume is 838,879, up 103,950 compared to T - 1; the open interest is 395,102, down 18,995 compared to T - 1 [2] - **Warehouse Receipts**: The quantity is 24,045 hands, up 430 compared to T - 1 [2] - **Raw Materials**: The price of spodumene concentrate (6%, CIF China) is 951, down 27 compared to T - 1; the price of lepidolite (2.0% - 2.5%) is 2,125, down 60 compared to T - 1 [2] - **Lithium Salts**: The price of battery - grade lithium carbonate is 85,700, unchanged compared to T - 1; the price of industrial - grade lithium carbonate is 83,400, unchanged compared to T - 1 [2] 3.2 Macro and Industry News - **Price Changes**: The SMM battery - grade lithium carbonate index price is 85,224 yuan/ton, down 528 yuan/ton compared to the previous working day; the average price of battery - grade lithium carbonate is 85,200 yuan/ton, down 500 yuan/ton compared to the previous working day; the average price of industrial - grade lithium carbonate is 82,900 yuan/ton, down 500 yuan/ton compared to the previous working day [3] - **Production and Inventory**: This week, the lithium carbonate production is 19,138 tons, a decrease of 842 tons from last week; the industry inventory is 141,543 tons, a reduction of 713 tons from last week [3] - **Company News**: SQM, one of the world's largest lithium producers, raised its annual sales target after a 28% drop in core profit in Q2 and is optimistic about price recovery. It expects a quarterly sales volume increase of over 10% and a higher selling price in Q3 than in Q2. Its Australian joint - venture refinery has achieved commercial production, with a planned annual lithium hydroxide capacity of 50,000 tons in 2026. Sigma Lithium's Q2 lithium concentrate production reached 68,368 tons, a 38% year - on - year increase, but its sales volume decreased by 23% year - on - year to 40,350 tons due to a stockpiling strategy during volatile lithium prices. The company's second - phase plant construction has started, and the annual production capacity will double to 520,000 tons after commissioning [4]

Core Viewpoint - SQM's core earnings declined in Q2 due to a significant drop in lithium prices, reaching a multi-year low, with adjusted earnings down 28% year-over-year to $307.9 million [1] Group 1: Financial Performance - Adjusted earnings for SQM fell to $307.9 million, a 28% decrease compared to the same period last year [1] - The company's sales volume in Q2 decreased compared to Q1 due to low market prices [1] Group 2: Market Dynamics - The lithium industry is facing severe impacts from global oversupply, leading to significant price declines, although recent production cuts in China have contributed to a price rebound [1] - Recent market dynamics suggest that prices in Q3 may be higher than in Q2 [2] Group 3: Future Outlook - SQM expects a 10% increase in sales volume in Chile by 2025 compared to last year [1] - The company has raised its sales forecast for Australia and anticipates a "significant increase" in production in the second half of the year [1] - SQM's international lithium business sales forecast for 2025 has been adjusted to approximately 20,000 tons of lithium carbonate equivalent [1] - The joint venture with Kwinana refinery achieved its first commercial production in July, with full capacity expected to reach 50,000 tons of lithium hydroxide by the end of 2026, half of which will belong to SQM [2]

Core Viewpoint - Citigroup's report indicates that CATL (宁德时代) demonstrates strong profit defense capabilities during lithium price fluctuations, suggesting its ability to withstand shocks is superior to its peers [1] Company Summary - CATL maintains a "highly confident outperform" rating for its A-shares with a target price of 390 RMB and an "outperform" rating for its H-shares with a target price of 535 HKD [1] - The Yichun lithium mine factory of CATL has suspended production since August 10 due to the expiration of its mining license, which is linked to the government's crackdown on illegal lithium mining since July [1] - The impact of the Yichun factory's suspension on CATL's operations is expected to be limited due to the company's diversified lithium resource supply channels, allowing for quick shifts to third-party procurement if necessary [1] Industry Summary - The suspension of the Yichun factory may have significant ripple effects on the global lithium supply landscape, potentially raising market sentiment towards lithium prices [1] - Short-term upward risks for lithium prices are anticipated, which could suppress battery manufacturers' profits in the second half of the year [1]

Core Viewpoint - Citigroup's report indicates that CATL (宁德时代) demonstrates strong profit defense capabilities during lithium price fluctuations, suggesting its ability to withstand shocks is superior to its peers [1] Group 1: Company Performance - Citigroup maintains a "highly confident outperform" rating for CATL's A-shares with a target price of 390 RMB and an "outperform" rating for its H-shares with a target price of 535 HKD [1] - The report highlights CATL's diversified lithium resource supply channels, which allow the company to quickly shift to third-party procurement if necessary [1] Group 2: Industry Impact - CATL's Yichun lithium mine factory has suspended production since August 10 due to the expiration of its mining license, which is linked to the government's crackdown on illegal lithium mining since July [1] - The suspension is expected to have a limited operational impact on CATL but may significantly affect the global lithium supply chain, potentially raising market sentiment towards lithium prices [1] - Short-term upward risks for lithium prices are anticipated, which could suppress battery manufacturers' profits in the second half of the year [1]

Core Viewpoint - The report from Citi indicates that CATL's Yichun lithium mine has suspended production due to the expiration of its mining license, which may have limited operational impact on the company due to its diversified lithium resource supply channels [1] Group 1: Company Impact - The suspension of the Yichun plant is expected to have a limited operational impact on CATL, as the company can quickly shift to third-party procurement if necessary [1] - CATL has demonstrated strong profit defense capabilities during periods of lithium price volatility, suggesting it can better withstand shocks compared to its peers [1] Group 2: Industry Implications - The suspension may lead to significant ripple effects in the global lithium supply landscape, potentially increasing market sentiment towards lithium prices [1] - Short-term upward risks for lithium prices are anticipated, which could suppress battery manufacturers' profits in the second half of the year [1] Group 3: Ratings and Targets - Citi reaffirms a "highly confident outperform" rating for CATL's A-shares with a target price of 390 yuan, and an "outperform" rating for its H-shares with a target price of 535 Hong Kong dollars [1]