leading lithium battery material companies expand production
Up to now, the global battery head companies plan to have a battery production capacity of more than 3.5TWh by 2025, and the demand for battery raw materials will maintain high growth.
Benefiting from the strong downstream demand, and since the second half of last year, the price of some materials for lithium batteries has risen sharply and has remained high so far, which makes some material products have broad market prospects and higher output returns.
In order to seize the development opportunities of the lithium battery industry, since May 2022, some leading lithium battery material companies have set up plans to raise funds to expand production.
|The fixed increase of some lithium battery material companies since May 2022|
|Companies||Fixed increase amount||Project|
|Zhenhua||6 billion RMB||Cathode material production line construction project (Phase III of Yilong) and supplementary working capital.|
|Zhongwei||6.68 billion RMB||60,000 tons of laterite brocade ore smelting project, 80,000 tons of sulfuric acid brocade project, 80,000 tons of Gaobing brocade project, and 200,000 tons of iron phosphate project in Guizhou.|
|Dynanonic||3.2 billion RMB||2.3 billion RMB is used for the production base project of new phosphate-based cathode materials with an annual output of 110,000 tons, and 900 million RMB is used to supplement working capital|
|Longpan Technology||2.2 billion RMB||It is used in the construction of projects such as large-scale production of cathode materials for new energy vehicles and energy storage batteries.|
|Jiayuan Technology||4.722 billion RMB|
It is used for the investment project of raising funds for high-performance lithium battery copper boxes, the technical transformation project of Jiayuan’s new high-performance copper box with an annual output of 16,000 tons, and the high-performance copper box project with an annual output of 15,000 tons.
Annual output of 30,000 tons of high-precision ultra-thin electronic copper box project, Jiayuan annual output of 20,000 tons of electrolytic copper box project and supplementary working capital.
The above-mentioned fixed increase involves many fields such as lithium battery precursors, cathode materials, copper foils, etc., and has received extensive attention. This also reflects that during the large-scale expansion cycle of downstream battery companies, lithium battery material companies are highly motivated to expand production, and investment institutions also have high investment enthusiasm and confidence in lithium battery material products.
Frequently ordered increase order
The table shows that there are 2 companies with a fixed increase planning amount of 6.0-6.68 billion RMB, and the other 3 companies are 2.2-4.722 billion RMB. The fixed increase amount is very high.
It is understood that the current customers of Zhenhua New Materials include mainstream lithium battery companies such as CATL, Funeng Technology, Polyfluoride, Zhuhai Guanyu, ATL, and Tianjin Lishen.
In the first quarter of 2022, the capacity utilization rate of its Yilong Phase II has exceeded 80%, and the overall production capacity is relatively tight, and it will face the risk of being unable to meet the rapidly growing order demands of downstream customers.
“It is planned to make up for the company’s shortcomings in production capacity and consolidate and enhance the company’s market position through this fixed increase and expansion of production.” Zhenhua New Materials said.
As one of the world’s leading ternary precursor companies, Zhongwei’s fundraising is intended to extend its business to upstream nickel products and increase the profit growth point of iron phosphate to maintain market competitiveness.
This fixed increase fundraising is only half a year away from the last large fixed increase of Zhongwei Co., Ltd. Not only is the fixed increase planned amount large, but also the frequency is high, which shows that the company has a strong willingness to expand production.
Premium fixed increase
Judging from the completed fixed increase, Battery China also found that more than one company has completed the premium fixed increase, which is conducive to the company’s expansion and acceleration.
Among them, Dynanonic in Top 5 lithium iron phosphate cathode material companies disclosed on June 9 that it had raised 3.2 billion RMB by fixed increase. According to the announcement, the issue price is 255RMB/share, which is 1.25 times the benchmark price.
In terms of products, its main products are phosphate-based cathode materials such as lithium iron phosphate, which are mainly used in the manufacture of lithium batteries. In terms of customers, it has formed long-term cooperative relationships with leading battery companies such as CATL, Yiwei Lithium Energy, and BYD.
Therefore, Dynanonic’s private placement not only attracted the participation of investors such as Hillhouse Capital, CITIC Securities, China Asset Management, and HFT Fund, but also internationally renowned institutions such as JPMorgan Chase and UBS were successfully allocated.
At present, there are 7 expansion projects disclosed by Dynanonic. If all of them are completed in the future, they will add an annual production capacity of 865,000 tons of lithium iron phosphate cathode materials and lithium supplement materials, further consolidating its market position.
Longpan Technology has completed a fixed increase of RMB 2.2 billion at a premium of 9.86%, and the funds will be used for the construction of projects such as large-scale production of cathode materials for new energy vehicles and energy storage batteries.
Longpan Technology is one of the leading companies in the field of chemicals. In recent years, in response to the rapid transformation of the situation, it has deployed lithium battery materials and other businesses, and has continued to expand its layout. In this fixed increase, 15 well-known institutions including BNP Paribas, CITIC Securities, China Universal Fund were successfully allocated.
To a certain extent, the premium issuance also proves that the institution is optimistic about the future prospects of the company’s products, and also provides favorable support for the rapid expansion of the company’s production.
Multi-category lithium battery material companies plan to increase production
Not only precursor and cathode material companies, but also lithium battery copper foil and other companies are also planning to increase production.
On May 10, Jiayuan Technology as Top 10 global lithium battery copper foil companies fixed increase plan of no more than 4.722 billion RMB was approved by the Shanghai Stock Exchange and will focus on projects such as lithium battery copper foil.
In addition, there are also pharmaceutical companies that have recently planned to increase their cross-border involvement in the field of lithium battery electrolyte additives. This also proves the popularity of the lithium battery material market.
In fact, with the intensive expansion of battery companies such as CATL, Guoxuan Hi-Tech, SVOLT, EVE, and Envision Power in Top 10 power battery companies in the world.
It will definitely drive greater demand for upstream material supply, and material companies are imminent to expand production. Fundraising is obviously the most important means for material companies to quickly raise funds, expand production and ensure supply.
The further expansion of material companies is expected to play a significant role in the stable supply of the lithium battery industry chain.
Next, more material companies may join the ranks of fixed increase in order to speed up their own capacity expansion and deepen the binding of downstream battery companies. With the gradual formation of the new production capacity pattern of material companies, it may help to stabilize the competitive advantages of the leading companies, seize the market voice, and maintain long-term sustainable development.
It is also necessary to be vigilant that some materials may have the risk of overcapacity, the leader may still have the upper hand, and there may be some areas where the superior and the inferior may be eliminated.