Investment Rating - The report maintains a "Cautious Recommendation" rating for the company [4][6]. Core Views - The company reported a significant decline in performance for H1 2025, with revenue of 1.61 billion yuan, down 37.4% year-on-year, and a net loss attributable to shareholders of 840 million yuan, an increase in loss of 349.9% year-on-year [1]. - The company is accelerating its resource integration layout despite the performance drag from inventory impairment [3]. - The lithium product prices have been on a downward trend, with battery-grade lithium carbonate averaging 75,000 yuan/ton in Q1 and 65,000 yuan/ton in Q2, reflecting year-on-year declines of 26.1% and 38.2% respectively [2]. Summary by Sections Financial Performance - In H1 2025, the company achieved a revenue of 1.61 billion yuan, with a gross margin of -3.7%, a decrease of 6.9 percentage points year-on-year [2]. - The company recorded an operating cost of 1.67 billion yuan, down 33.3% year-on-year, attributed to a decrease in sales volume and unit costs of lithium salt products [2]. Inventory and Impairment - The company recognized an asset impairment loss of 440 million yuan in H1 2025, which accounted for 43.5% of total profit, significantly impacting overall performance [3]. - The company also recorded a credit impairment of 70 million yuan, with 10 million yuan for accounts receivable and 60 million yuan for other receivables [3]. Resource Development - The company has significantly increased its self-owned mineral production capacity, with the Sichuan Yilonggou lithium concentrate capacity maintained at 75,000 tons/year and the Zimbabwe Sabie Star mine capacity reaching 290,000 tons/year after technical upgrades [2]. - The company is actively developing the Muliang lithium mine, which has obtained mining permits and is planned to have a production capacity of 3 million tons [3]. Future Outlook - The company expects to turn profitable in 2026 and 2027, with projected net profits of 300 million yuan and 620 million yuan respectively, corresponding to PE ratios of 52 and 25 based on the closing price on August 27 [4][5].