DBS released a research report sayingJungleJackpotJingle, maintain the "Buy" rating of Tianqi Lithium Industry (09696)JungleJackpotJingleIt is estimated that the impairment from SQM's tax dispute is only a one-time impact and has been reflected in the first quarter. It is expected that the company's future performance will be in line with the expansion of its lithium compound production capacity and the reduction of lithium concentrate mining costs. The target price will be lowered from HK$57 to HK$48.
According to the report, the company's revenue in the first quarter of this year fell 77% year-on-year, and it turned from profit to loss, achieving a net loss of approximately 39JungleJackpotJingle.20 million yuan, a profit of approximately 48% compared with the same period last yearJungleJackpotJingle.80 million yuan, mainly affected by the sharp drop in lithium prices and SQM's tax impairment losses. The bank pointed out that the current lithium price has fallen from historical highs and has stabilized. Among them, the price of lithium carbonate has dropped from a historical high of about 570,000 yuan per ton at the end of 2022 to about 120,000 yuan in May this year. It is predicted that this year Lithium carbonate prices will stabilize at RMB 100,000 to 120,000 per ton throughout the year. As mining costs decline in the next few years, the expected increase will be limited.
