On December 26, with the approval of the Shenzhen Stock Exchange, Shijiazhuang Shangtai Technology Co., Ltd. (hereinafter referred to as Shangtai Technology), a new supplier of artificial graphite anode materials, will be listed on the main board of the Shenzhen Stock Exchange on December 28. After the initial public offering, the total share capital is 259 million shares, the number of initial public offering shares is 64.9437 million shares, the issue price is 33.88 yuan per share, and the issue price-earnings ratio is 16.28 times.
In this IPO, Shangtai Technology plans to publicly issue no more than 64.9437 million new shares, and plans to raise funds of 2.064 billion yuan. After deducting the issuance expenses, it plans to use about 1.064 billion yuan for the “Suntai Technology Beisu Headquarters Project” and 1 billion for supplementary funds. working capital.
In recent years, with the prosperity of the lithium battery industry, anode materials have also ushered in rapid development. The sales volume of Shangtai Technology’s anode materials has grown rapidly, quickly narrowing the gap with traditional anode material manufacturers, and its position in the industry is gradually rising. From 2019 to 2021, Shangtai Technology ranks 7th, 6th and 5th among domestic anode material manufacturers, becoming a dark horse in the anode material industry.
1 Opportunities for the birth of negative electrode materials
According to the official website, Shangtai Technology was established in 2008 and has been focusing on the research and production of graphite powder materials; in 2017, the company transformed from anode material graphitization processing services to a set of independent research and development of anode materials, integrated production, processing, and sales. It is a high-tech enterprise and has established a wholly-owned subsidiary Shanxi Shangtai Lithium Battery Technology Co., Ltd.
From 2019 to 2022, the company has successively completed the construction of 30,000-ton, 50,000-ton, and 120,000-ton production lines in Xiyang, Shanxi, and will build a 300,000-ton production line in 2023. At present, the company has become a rare and leading scale lithium-ion battery in the industry that can cover crushing, granulation, graphitization, carbonization, finished product processing, etc., with self-built graphitization capacity as the core, and realize integrated production. Anode material manufacturers.
Negative electrode material is one of the main raw materials of lithium batteries. Together with positive electrode material, electrolyte and separator, they are called the four major raw materials of lithium batteries, accounting for 10%-15% of the cost of lithium batteries. At present, the anode materials used in lithium-ion batteries are generally carbon materials, such as graphite, soft carbon (such as coke, etc.), hard carbon, and the like. The anode materials being explored include nitrides, PAS, tin-based oxides, tin alloys, nano-anode materials, and some other intermetallic compounds. The artificial graphite anode material has become the mainstream product in today’s lithium battery anode material market due to its advantages of high rate, long cycle, and low expansion. The terminal is mainly used in digital products, new energy electric vehicles, wind and new energy storage and other fields.
Benefiting from the explosive growth of demand in the downstream market of lithium batteries, the production and sales of lithium battery anode materials are also increasing year by year.
According to the data of Gaogong Lithium Battery, my country’s anode material shipments will reach 370,000 tons in 2020, with a compound growth rate of 33.07%, accounting for 69.8% of the global market share, and becoming a major producer of anode materials. In 2021, my country will ship 720,000 tons of anode materials, a year-on-year increase of 94.60%, accounting for 75.8% of the global market share. Gaogong Lithium Battery predicts that by 2025, China’s anode material market will continue to develop at a compound growth rate of more than 40%. The scale of China’s anode material market is expected to increase from 720,000 tons in 2021 to 2.8 million tons in 2025.
Since its establishment more than ten years ago, Shangtai Technology has been in a state of tepid and unknown. After the company seized the opportunity to transform into an anode material processing enterprise in 2017, its performance has skyrocketed .
According to the prospectus, from 2019 to 2021, the sales volume of Shangtai Technology’s anode materials will reach 11,200 tons, 19,200 tons, and 64,800 tons respectively, with a compound annual growth rate of 140.73%. In the first half of 2022, the sales volume of the company’s anode materials has reached 50,100 tons, continuing the rapid growth trend. Although there is a certain gap in shipments compared with leading companies such as Shanshan, Bestray , Putailai , and Zhongke Electric , the rising trend is extremely fast.
In terms of main performance data, from 2019 to 2021 and the first half of 2022, Shangtai Technology will achieve operating income of 547 million yuan, 682 million yuan, 2.336 billion yuan and 2.198 billion yuan respectively; realize net profit of 88 million yuan, 153 million yuan, 543 million yuan. 100 million yuan and 692 million yuan.
It is estimated that the annual operating income in 2022 will exceed 5 billion, an increase of more than 110% compared with 2021; the net profit will exceed 1.4 billion, an increase of more than 160% compared with 2021.
Although the company’s development was slow in the early years, it was precisely because of the focus on the research of graphite powder materials in the early years that Shangtai Technology has accumulated a lot.
According to the prospectus, compared with major companies in the same industry, Shangtai Technology’s anode material production processes are all carried out independently, and rarely purchase entrusted processing services, thereby reducing the outflow of gross profits caused by entrusted processing. The company can control the entire production process, and then control the cost of each process. The compact distribution of each process in the same production base improves the overall production efficiency, reduces transportation expenses, reduces production costs, and improves profitability.
In addition, rich experience in production technology, equipment design and production management also brings certain cost advantages to Shangtai Technology, which greatly improves the gross profit rate of Shangtai Technology.
According to the prospectus, in the first half of 2019-2022, the gross profit margins of Shangtai Technology’s main business were 37.08%, 35.38%, 35.85% and 43.21%, respectively, of which the gross profit margins of anode materials were 40.63%, 38.02%, 40.04% and 46.57%. In the same period, the average gross profit margins of six comparable companies in the same industry, such as Beiterui, Shanshan, and Putailai, were 29.15%, 30.36%, 28.44%, and 21.65%, which shows that the profitability of Shangtai Technology is also higher than that of peer companies. at the leading level.
2 Deeply bound Ningde era
Relying on its technological and technical advantages, Shangtai Technology has been recognized by many downstream lithium battery leaders.
According to the company’s official website, the company has entered the Ningde era , Guoxuan Hi-Tech , Honeycomb Energy , Ruipu Lanjun, Ningde New Energy, Sunwoda , Vision , Wanxiang 123 , Envision Power, ZTE Power, etc. The supply chain of battery manufacturers has established a stable supply relationship.
In particular, Ningde Times is currently the largest customer of Shangtai Technology, with a high proportion of sales, and its sales have increased significantly year by year.
According to the prospectus, from 2018 to 2021, the sales of Shangtai Technology to Ningde Times and its subsidiaries accounted for 16.77%, 59.01%, 57.73% and 63.04% of the operating income respectively.
Due to the concentration of customers, Shangtai Technology was required by the Shenzhen Stock Exchange to explain: the reasons and rationale for the high proportion of sales to Ningde Times and the increase in the amount year by year; Whether the business development of CATL matches, whether the Ningde era selectively gives business opportunities to the issuer; whether the issuer has a major dependence on the Ningde era, etc.
In this regard, Shangtai Technology stated in the prospectus that it is due to the high concentration of the downstream new energy vehicle power battery industry. Shangtai Technology also stated that if it cannot continue to obtain orders from Ningde Times and its subsidiaries, and fails to expand new customers in time, it will have a negative impact on the company’s operating conditions. From this point of view, the company does have a problem of excessive customer concentration.
Therefore, Shangtai Technology is continuing to develop new customers. It is understood that the company has sent samples to well-known lithium-ion battery manufacturers such as LG New Energy and BYD for testing, and it is expected to achieve batch supply in the future.
With the continuous expansion of delivery volume, Shangtai Technology also has a certain production capacity bottleneck. During the reporting period, from 2019 to 2022, the capacity utilization rates of Shangtai Technology’s anode materials were 74.34%, 66.64%, 113.30% and 112.87%, respectively. At present, the company’s anode materials are in full production.
Under the bottleneck of production capacity, Shangtai Technology has an urgent need for production expansion. The 1.064 billion yuan raised in this IPO will be used for the “Suntai Technology Beisu Headquarters Project”, specifically for the project with an annual output of 70,000 tons of lithium-ion battery anode materials, R&D centers and headquarters construction project. After the project is completed, it will add about 70,000 tons/year of graphite anode material production capacity for lithium-ion batteries, effectively alleviating the shortage of production capacity.
Prior to this, in 2019, the company established the first-phase production base in Xiyang, Shanxi; in 2020, it began to build the second-phase production base in Xiyang, Shanxi, and it will be put into production in the second quarter of 2021. The production capacity of artificial graphite anode materials will also start from 2019 The 17,100 tons/year will increase to 58,300 tons/year in 2021.
Combined with Shanxi’s first phase of 30,000 tons, second phase of 50,000 tons, and third phase of 120,000 tons, the total production capacity will be close to 300,000 tons after production. In addition, Shangtai Technology will build the Shanxi Phase IV project base with an annual output of 300,000 tons in 2023. In the next few years, the total production capacity will exceed 500,000 tons, catching up with the production capacity of leading enterprises. Total production capacity of 600,000 tons.
However, the large-scale expansion of production by negative electrode material companies has also aroused concerns about the structural overcapacity of the industry.
In the first half of this year, Bertray, Shanshan, and Kaijin Energy all started construction of large-scale anode integration projects. According to incomplete statistics, since 2022, more than 30 anode material expansion projects have been launched, involving a scale of more than 4 million tons, which can meet the production demand of over 4000GWh batteries. The Ministry of Industry and Information Technology released the operating conditions of the national lithium-ion battery industry from January to October, showing that the total output of lithium-ion batteries in the country from January to October exceeded 580GWh, which is only 1/8 of the production capacity that can be met by negative electrode materials.
But for the capital, the price-earnings ratio of Shangtai Technology’s issuance is only 16.28 times, which is lower than the average price-earnings ratio of 30 to 40 times for listed companies in the same industry, and the listing performance is worth looking forward to.
This article comes from the WeChat public account “Battery Wind and Cloud” (ID: gh_212420c9f351) , author: Da Wei, editor: Kaixuan, 36 Krypton is authorized to publish.
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