In the market environment of rapid increase in the penetration rate of new energy vehicles and a sharp rise in demand for power batteries, power battery companies have not increased their income in the first quarter of this year.
At the end of April, power battery companies have disclosed the first quarter of this year's financial reports. According to the financial reports, due to the strong downstream demand, the operating income of power battery companies in the first quarter, including Ningde Times, Yiwei Lithium Energy, Guoxuan Hi-Tech, Fu Neng Technology, and Sunwoda, has increased significantly, but due to the impact of the sharp rise in upstream raw materials and prices, profits have declined to varying degrees year-on-year.
Yu Qingjiao, secretary general of the Zhongguancun New Battery Technology Innovation Alliance, said that the year-on-year decline in profits is not a problem of a certain enterprise, but a problem of the whole industry; from the perspective of the entire industrial chain, with the synergy effect between the upstream and downstream industrial chains, or the construction of a healthy ecology of the industrial chain, it will gradually return to a normal state.
Ice and fire two days: the first quarter revenue increased sharply year-on-year, and the net profit fell year-on-year
In the first quarter of this year, CATL achieved operating income of 48.678 billion yuan, an increase of 153.97% year-on-year; net profit was 1.493 billion yuan, down 23.62% year-on-year. It is worth noting that the operating cost of CATL in the first quarter of this year was 41.628 billion yuan, an increase of 198.66% year-on-year; in this regard, CATL explained in the quarterly report that there are two main factors, one is that the cost of sales increases accordingly, and the other is the rapid rise in the price of some upstream materials. CATL said that the price of raw materials such as lithium carbonate rose more than expected, and the client price transmission was relatively cautious.
Guoxuan Hi-Tech's operating income in the first quarter of this year was 3.916 billion yuan, an increase of 203.14% year-on-year, and net profit was 0.32 billion yuan, down 32.79% year-on-year. From the first quarter report of Guoxuan Hi-Tech, it can be found that the operating cost of Guoxuan Hi-Tech in the first quarter also increased significantly, with operating costs of 3.349 billion yuan, an increase of 245.44% year-on-year, and Guoxuan Hi-Tech explained in the quarterly report that the operating income of the current period increased, resulting in the corresponding increase in operating costs.
The same is true for Ewell Lithium Energy, which achieved operating income of 6.734 billion yuan in the first quarter, an increase of 127.69% year-on-year, but the net profit fell by 19.43% year-on-year to 521 million yuan; at the performance briefing, Ewell Lithium Energy said that from the perspective of profitability, the first quarter power battery did not have much profit. The operating cost of Ewell Lithium Energy in the first quarter was 5.808 billion yuan, an increase of 168.79% year-on-year.
Relatively speaking, the performance gap of Fu Neng Technology in the first quarter is more obvious. In the first quarter, the operating income was 1.529 billion yuan, an increase of 317.09% year-on-year; but the loss expanded to 244 million yuan, down 38.55% year-on-year. In the first quarter, the operating cost of Fu Neng Technology was 1.425 billion yuan, an increase of 304.82% year-on-year. Another power battery company, Sunwoda achieved operating income of 10.62 billion yuan in the first quarter of this year, an increase of 35.1% year-on-year, and net profit of 0.9 billion yuan, down 26.1% year-on-year. Zhongtai Securities analysis said that affected by the irrational sharp rise in upstream raw material prices, the profit side of Sunwoda continued to be under pressure in the first quarter of this year.
According to the data of China Automotive Power Battery Industry Innovation Alliance, in the first quarter of this year, Ningde Times, Guoxuan Hi-Tech, Ewell Lithium Energy, Fu Neng Technology, and Sunwoda ranked first, fourth, seventh, eighth and ninth in the list of vehicle loads, respectively.
Yu Qingjiao said, "Most of the power batteries are in a situation of upper and lower pressure, and the six main materials of the battery are increasing in price." The upstream mining of raw materials is also constantly increasing prices, such as lithium ore, copper ore, cobalt ore, nickel ore, etc., the price increase of mining is transmitted to the price of materials, and the price of materials is transmitted to the price of batteries. In the terminal market, car companies are facing consumers, consumers naturally hope that the lower the price, the better, and car companies must also respond to consumers, thereby squeezing the power battery factory upwards, resulting in most of the profits of power battery listed companies are declining. ”
According to the research report data of Industrial Securities, since 2021, the cost of lithium iron phosphate batteries has risen by more than 90%. In fact, as early as the third quarter of last year, some power battery companies have already experienced a decline in net profit and gross profit margin. For example, in the third quarter of 2021, Fu Neng Technology lost 974 million yuan, an increase from the same period of the previous year; Sunwoda's net profit fell by 88.81% year-on-year.
At that time, Fu Neng Technology and other enterprises said that the price of raw materials has risen sharply, the cost of materials has increased, due to the lag in price adjustment, the price of products during the year has not been adjusted in time with the rising trend of power battery material prices.
The price of raw materials has risen across the board, which has deviated from the normal supply and demand relationship
Sunwoda said at the performance briefing that the price increase of raw materials upstream of power batteries is now an industry problem. Jiang Li, secretary of the board of directors and deputy general manager of Ningde Times, said that the price of raw materials has risen too sharply this year, which has far exceeded the reasonable price level; previously, at the electric hundred people meeting, Zhang Feng, senior vice president of Fu Neng Technology, also said, "The recent days of battery companies are very sad, mainly affected by the rise in raw material prices." ”
The main raw materials of power batteries include cathode materials, anode materials, diaphragms and electrolytes, etc., which are greatly affected by the prices of bulk commodities such as lithium, nickel, cobalt or chemical raw materials.
In the first quarter of this year, the average price of battery-grade lithium carbonate soared from nearly 300,000 yuan per ton in early January to 515,000 yuan, a three-month price increase of about 80%; the highest point of nickel quotation in the first quarter was more than 300,000 yuan / ton, and the quotation of cobalt in the East China market rose from less than 490,000 yuan / ton to 566,000 yuan / ton.
GGII data statistics, ternary nickel cathode materials, lithium iron phosphate cathode materials, electrolyte and negative electrode materials, the average price of the market at the end of the first quarter of this year compared with the price at the beginning of last year, the increase in the range of 171%, 222%, 98% and 18%, respectively.
According to the data of China Automotive Power Battery Industry Innovation Alliance, from the beginning of 2021 to March 2022, the average price of cathode ternary lithium materials rose from 124,000 yuan / ton to 368,000 yuan / ton, an increase of 196.8%; the average price of lithium iron phosphate materials soared from 40,000 yuan / ton to 162,000 yuan / ton, an increase of 305%; the average price of upstream spodumene rose from 25,000 yuan / ton to 136,000 yuan / ton; the average price of ternary lithium battery electrolyte rose by 146.2% The electrolyte of lithium iron phosphate batteries rose by an average of 190.2%; the sharp rise in prices put pressure on the profits of power battery companies.
"The price of lithium carbonate rose rapidly in the first quarter, while the sales volume of new energy vehicles did not show a high growth in the fourth quarter, resulting in disturbances in the inventory cycle between enterprises." Chen Zikun, chief analyst of the new electricity industry at GF Securities, said in an analysis that "for every 100,000 yuan increase in the price of lithium carbonate, the profit impact of a gigawatt-hour power battery is about 70 million yuan; the entire battery company is indeed under relatively large short-term pressure." ”
Chen Shihua, deputy secretary-general of the China Association of Automobile Manufacturers, said, "This round of raw material prices has risen beyond the norm, deviating from the normal supply and demand relationship, which is an irrational rise, and there are unfair competition behaviors such as hoarding and deliberately inflating prices in order to seize the last window period before the expansion of lithium production capacity." ”
However, the price increase of raw materials has slowed down at present. In April, the price of lithium carbonate showed a slight correction, and the price continued to fall, falling below the 500,000 yuan / ton mark. Zhang Xiaorong, president of the DeepIn Science and Technology Research Institute, said, "The decline in the price of lithium carbonate is mainly due to the intervention of regulatory authorities. The relevant departments interviewed lithium salt enterprises, asked to promote reasonable and stable operation of prices, and curbed the speculation of lithium carbonate prices. However, for the price trend of lithium carbonate throughout this year, Zhang Xiaorong believes that the probability remains high and fluctuates slightly.
What to save? A number of power battery companies and vehicle companies have renegotiated prices
It is reported that in the first quarter of this year, in the face of the soaring price of upstream raw materials, a number of power battery companies and vehicle companies have conducted new bargaining.
In March, the relevant person in charge of the Ningde era told the Beijing News shell financial reporter, "Affected by the upstream price increase, the price of some battery products has been dynamically adjusted." During the electric 100 people's meeting, Zhang Feng, vice president of Fu Neng Technology, said to the outside world, "The price of raw materials has risen further this year, and Fu Neng Technology has also conducted a second round of consultations with customers, hoping to share the increase in raw material prices with customers." "Ewell Lithium Energy also said that it has discussed prices with major customers and has reached a consensus; Sunwoda has also publicly stated that according to different customers, projects and product structures, the price has been adjusted accordingly, and the increase is based on the level of leading companies in the industry.
Although the profits of power battery companies were squeezed in the first quarter, various power battery companies are increasing investment in research and development and capacity construction.
In the first quarter of this year, the R&D expenses of CATL were 2.568 billion yuan, an increase of 117.49% year-on-year; the R&D investment of Guoxuan Hi-Tech in the first quarter was 191 million yuan, an increase of 142% year-on-year; the R&D investment of Ewell Lithium Energy in the first quarter was 406 million yuan, an increase of 90.54% year-on-year, while Ewell Lithium Energy said that it would reduce its holding of no more than 3.5% of the shares (about 210 million shares) of Smol International to meet the company's R&D platform construction and R&D investment capital needs.
In terms of expansion, there are about 29 new domestic power battery projects in the first quarter of this year, with an estimated total investment of more than 330 billion yuan and a planned power battery production capacity of more than 800GWh, all higher than the same period last year. In addition, it is worth noting that the main force of the expansion of the power battery industry in the first quarter is the second-line power battery companies such as Hive Energy, Sunwoda, and Zhongxin Airlines. Bai Yiyang, manager of the research department of CMB International Securities, believes that "the rise of second-line battery factories is inevitable, the core is mainly that the depot is gradually developing two-supply and three-supply for supply chain security, and the demand for second-line battery factories has increased." ”
In the face of the continuous rise in raw material prices, what should power battery companies do? According to the analysis of Gaogong lithium battery, in order to ensure supply, head power battery companies will further consolidate their upstream industrial chain layout, create a new type of partnership by breaking the previous simple buying and selling relationship, carry out strategic cooperation on a larger scale and at a deeper level, promote the coordinated development of the supply chain, and reshape the new supply chain model.
In addition, controlling upstream resources has also become the main way. In April this year, Yichun Times New Energy Mining Co., Ltd., a subsidiary of Ningde Times Holdings, purchased the prospecting rights for ceramic soil (including lithium) in the Fengxiawo Mining Area of Fengxin County, Zhenkou Li, Yifeng County, Jiangxi Province; at the beginning of this year, BYD won the bid for the Chilean lithium mining right.
In addition, in September last year, CATL signed a final agreement with The Canadian lithium mining company Millennial Lithium, which has more than 10,000 hectares of salt lakes in Argentina, after CATL invested 13.5 billion yuan in Yichun to build a new lithium battery manufacturing base.
Guoxuan Hi-Tech, Yiwei Lithium Energy and other major battery factories in the investment in lithium ore is not lagging behind, Ewell Lithium Energy acquired 34% of the equity and 40.59% of the equity of Dahua Chemical and Jinkunlun Lithium; in March this year, Guoxuan Hi-Tech plans to invest 12 billion yuan in upstream raw materials, in addition to its lithium carbonate project in the first quarter of this year, mass production, production capacity gradually released.
Or accelerate the industry reshuffle
However, it is worth noting that not all power battery companies have the ability to expand upstream, and some second- and third-tier companies have to face multiple pressures including supply chain pressure, rising cost pressure and capital chain pressure.
According to the analysis of the China Automotive Power Battery Industry Innovation Alliance, the reshuffle of the power battery market has accelerated, and the layering of the enterprise echelon is obvious. GGII data shows that the development of the power battery industry so far the number of battery companies has been sharply reduced, in 2021 there are a total of 97 battery companies with installed vehicles, of which there are 22 companies with less than 10 installed vehicles, if further relaxed to 100 units, the data becomes 51, which means that only 46 companies with more than 100 units are supplied; and only 35 battery companies in January this year have achieved car loading, a decrease of 1 compared with the same period last year.
In the short term, the market demand for new energy vehicles is strong, the supply and demand of upstream raw materials are still difficult to achieve balance in the short term, and power companies are still facing greater pressure. In the medium and long term, Ouyang Minggao, an academician of the Chinese Academy of Sciences, believes that the balance of supply and demand of lithium resources may return to normal after 2-3 years, and the mismatch between supply and demand is a short-term situation, and future demand will return to fundamentals; Li Jian, chairman of Guoxuan Hi-Tech, believes that with the expansion of production and the enhancement of mining capacity, the upstream raw materials of power batteries will be oversupplied in the future.
From the perspective of the profitability of power battery enterprises, CITIC Construction Investment Research Report believes that due to the weakening of downstream demand and the increase in supply and other factors, the prices of lithium, cobalt, lithium iron phosphate and other prices have entered a downward channel; lithium hexafluorophosphate, electrolyte and other links are due to the release of production capacity, prices continue to weaken, and the profitability of middle and downstream enterprises is expected to improve slightly.
Beijing News shell financial reporter Wang Linlin Yue Caizhou proofread Lu Qian
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