Core Viewpoint - Tianqi Materials achieved a net profit attributable to shareholders of 268 million yuan in the first half of 2025, representing a year-on-year increase of 12.79% [1] Financial Performance - In Q2 2025, the net profit attributable to shareholders was 118 million yuan, showing a quarter-on-quarter decline, but overall performance met market expectations [1] - The core product, electrolyte business, maintained strong growth, with revenue of 6.302 billion yuan in the first half of 2025, up 33.18% year-on-year [1] Cost Management and Profitability - Despite facing pressure on product prices, the company benefited from improved capacity utilization leading to cost reductions [1] - The company effectively hedged cost fluctuations through strategic layout of key raw materials and carbonated lithium futures hedging, maintaining stable profit per ton [1] Product Development and Market Expansion - The special chemicals segment, including positive and negative electrode binders and adhesives for lithium batteries, is rapidly scaling up and has formed a certain market size [1] - The company is advancing global capacity construction, with projects in Texas, USA, for an annual production of 200,000 tons of electrolytes, and an integrated lithium battery materials project in Morocco progressing as planned [1] Future Prospects - The company is proactively planning for emerging materials, with a pilot production line in the sulfide solid-state electrolyte field expected to be operational by mid-2026 [1] - Collaboration with a robotics company on PEEK materials is underway, with potential applications in robotics and aerospace sectors [1]

Investment Rating - The report maintains a "Buy" rating for the company, expecting the stock price to outperform the industry index by more than 15% in the next six months [5][18]. Core Views - The company has shown improvement in its performance with a significant increase in revenue and net profit in the first half of 2025, driven by the growth in lithium-ion battery materials [2][3]. - The company is focusing on expanding its product offerings and enhancing its competitive edge through innovation and integrated operations, particularly in new lithium battery materials and technologies [8][9]. Financial Summary - For the first half of 2025, the company reported a revenue of 7.03 billion, a year-on-year increase of 28.97%, and a net profit attributable to shareholders of 268 million, up 12.79% year-on-year [1][2]. - The overall gross margin for the first half of 2025 was 18.69%, slightly down from the previous year, while the net profit margin was 3.77%, reflecting a decrease of 0.61 percentage points year-on-year [2]. - The company’s cash flow from operating activities increased by 12.26% year-on-year, amounting to 409 million [3]. - The revenue from lithium-ion battery materials reached 6.30 billion, representing a 33.18% increase year-on-year, accounting for 89.66% of total revenue [3][4]. Future Projections - The company is projected to achieve revenues of 16.98 billion, 21.46 billion, and 25.71 billion for the years 2025, 2026, and 2027, respectively, with corresponding net profits of 811 million, 1.38 billion, and 1.93 billion [9]. - The expected EPS for the years 2025, 2026, and 2027 are 0.42, 0.72, and 1.01, respectively, with the current P/E ratios projected to decrease from 49.2 to 20.7 over the same period [9].

Core Viewpoint - The company reported strong revenue and profit growth in H1 2025, driven by its lithium battery segment and strategic investments in raw material production [1][2] Financial Performance - In H1 2025, the company achieved revenue of 7.029 billion yuan, a year-on-year increase of 28.97% - The net profit attributable to shareholders was 268 million yuan, up 12.79% year-on-year - The net profit excluding non-recurring items was 235 million yuan, reflecting a growth of 26.01% year-on-year - The lithium battery segment generated revenue of 6.302 billion yuan, with a growth of 33.18% and a gross margin of 17.05%, down 0.06 percentage points - The daily chemical materials and specialty cosmetics segment reported revenue of 614 million yuan, a 12.93% increase, with a gross margin of 30.27%, down 0.51 percentage points [1] Strategic Initiatives - The company is enhancing its cost advantages through an integrated layout and increasing production capacity of key raw materials such as lithium hexafluorophosphate and LiFSI - It has established a high-purity lithium carbonate refining production line and is planning capacity for ore smelting to improve product cost competitiveness - Systematic hedging of lithium carbonate futures and resource acquisition in Nigeria and Zimbabwe are being pursued to ensure supply chain stability - The company is building a circular industrial chain through the recycling of tailings, securing a sustainable cost advantage [1] Technological Development - The company is developing solid-state electrolytes to address future technological advancements, leveraging its existing liquid lithium salt production platform - It has successfully completed kilogram-level production of lithium sulfide-based solid-state electrolytes, forming initial patents and products - This development creates a dual-driven business model of "liquid + solid-state," providing a competitive edge [2] Business Expansion - The company is horizontally expanding into positive electrode materials, battery recycling, and battery adhesives - It possesses industry-leading liquid lithium hexafluorophosphate process technology, with costs below the industry average, gaining recognition from major international clients - In battery recycling, the company has scaled its channel network and collaborated with strategic partners to achieve a closed-loop ecosystem of "resources - materials - recycling" - The specialty chemicals segment, including positive and negative electrode binders and battery adhesives, is experiencing rapid growth and has completed a closed-loop system [2] Investment Outlook - The company is projected to achieve revenues of 16.22 billion yuan, 20.83 billion yuan, and 25.03 billion yuan for the years 2025, 2026, and 2027, respectively - Expected net profits attributable to shareholders are 830 million yuan, 1.32 billion yuan, and 1.98 billion yuan for the same years - Earnings per share (EPS) are forecasted to be 0.44 yuan, 0.69 yuan, and 1.03 yuan, with price-to-earnings (PE) ratios of 50, 32, and 21 times [2]