Yiwei Lithium has been investigated by 27 institutions： the company’s large cylindrical battery can be charged from 20% to 80% in almost 15 minutes, and even reach a higher level (with survey question
() The Record Form of Investor Relations Activities was released on August 29th, and the company was investigated by 27 institutions on August 25th, 2023. The types of institutions are fund companies and securities companies. Introduction to the main contents of investor relations activities: 1. Ms. Jiang Min, Secretary of the Board of Directors and Chief Financial Officer, introduced the company’s situation. In 2023, the company accelerated the process of globalization and started a new journey of "global manufacturing, global service and global cooperation". According to the established strategic plan, the company gradually released high-quality production capacity, and the shipment scale of power and energy storage battery business grew rapidly, and the market share was improved rapidly. During the reporting period, the company achieved a total operating income of 22.976 billion yuan, an increase of 53.93% compared with the same period of last year, of which the operating income of power battery was 12.119 billion yuan, an increase of 71.92% compared with the same period of last year; The operating income of energy storage batteries was 7.072 billion yuan, an increase of 120.17% compared with the same period of last year. The net profit attributable to shareholders of listed companies was 2.151 billion yuan, an increase of 58.27% compared with the same period of last year, of which the net profit attributable to shareholders of the parent company was 1.927 billion yuan, an increase of 109.28% compared with the same period of last year. In terms of shipments, the company’s power storage battery shipments in the first half of the year totaled 21.63GWh, of which the power battery shipments were 12.65GWh, an increase of 79.46% compared with the same period of last year; The shipment of energy storage batteries was 8.98GWh, an increase of 102.30% compared with the same period of last year. II. Dr. Liu Jincheng, Chairman of the Board of Directors, introduced the company’s business strategy in the first half of the year and its future prospects. This year, as the year of intensive lithium energy, the company continued to improve its strategic capacity building and made important progress in three aspects. The first is technological innovation. (1)46 series large cylindrical battery system has made great progress. In the first half of this year, through in-depth research, the company reached an important conclusion that the large cylindrical battery system can achieve NTP, which laid the technical foundation for the large cylindrical battery and its system to become one of the mainstream directions of power batteries. (2) The research progress of 18650 and 21700 all-pole ear batteries is leading. Thanks to the company’s breakthrough in C-cylinder and large-cylinder battery technology, the company is expected to be ahead of the same industry and complete the research and development of 18650 and 21700 full-scale ear batteries to open up high-end markets. (3) Research and development of large iron lithium battery and its system. According to the company’s design principle, the cost of the pack part of the 5MWh energy storage system can be reduced by 30% to less than 10 cents. This kind of progress is very important for the company’s products to remain competitive. The second is the construction of power battery quality management system. In the first half of the year, the company completed the concept construction of quality management upgrade and the improvement of the basic system, and the quality concept and management methods have undergone fundamental changes. The company constructs a digital quality system and upgrades the traditional quality management to quality research. From paying attention to the quality of delivery to paying attention to the perceived quality of customers, it is expected that the perception of power and energy storage battery clients will be significantly improved. The third is the digital upgrade of the manufacturing system. In the past year,The company has built a large number of single factories, and it is expected to complete the construction of digital manufacturing system this year. On the basis of large-scale factory construction, through digital upgrading, production and management efficiency will be improved and management and operation costs will be reduced. In the future, the company will provide customers with products and quality data packets representing the whole process of products to help customers make clear judgments on the quality of batteries. Looking forward to the second half of the year, the company will continue to improve its comprehensive capabilities. First, complete the construction of strategic supply chain. The company’s investment projects in lithium, separator, electrolyte and anode and cathode materials have been gradually completed and put into production, which is expected to have a positive impact on the company’s operating results. Second, continue to develop head customers. The company actively communicates with major automobile industry companies in Europe, the United States and Asia, and constantly develops incremental customers and obtains orders. Iii. Management answers questions from investors.
Q: The company’s semi-annual report in 2023 revealed that 1 million large cylindrical batteries had been rolled off the assembly line. Please ask Liu Gong to introduce some key index data of the current large cylindrical production line, as well as the verification progress of car companies and the most concerned issues of car companies under the background of promoting large cylindrical products at present.
A: The company’s first large cylindrical production line was completed at the end of last year. In the first half of this year, the millionth battery was rolled off the assembly line. Through the production of 1 million batteries, the company solved the productivity problem of large cylindrical batteries, and the products successfully entered the C-sample stage. One of the customers has completed PPAP audit and entered the mass production stage. In the third quarter of this year, batch production delivery began in September, which is a very good start. According to our communication with customers, on the one hand, car companies pay attention to the good performance of large cylindrical batteries, such as high-rate charging, which can be charged to 80% in 15 minutes at present; Good low temperature performance, still showing good output ability under the condition of MINUS 20 degrees. On the other hand, car companies are concerned about the decline in manufacturing costs brought about by mass production. Our evaluation shows that the manufacturing cost of large cylindrical battery is lower than that of ternary square battery, which is its advantage. At present, the market needs to further verify the substantial results and usage of NTP(Never Thermal Propagation). Different manufacturers have different requirements and cognition of batteries. We carefully choose the cooperative customers, so that the early application process will be as smooth as possible, and the commercialization of large cylindrical batteries and systems will be promoted smoothly. It is our current strategy to carry out wider promotion after more comprehensive verification.
Q: Just now, it was mentioned that the large cylindrical battery has the advantage of manufacturing cost compared with the square ternary battery. Can it be understood that in the future customer expansion, the profitability of the large cylindrical battery will be better than the power battery products launched by the company in the past?
A: We certainly hope so. In theory, products with new technologies should have better profits. But now, from the market point of view, downstream OEMs have higher requirements for prices. We hope to find a balance point: in cooperation with some customers, we pursue better prices; Another part of customers, the pursuit of good use of products. However, from the perspective of the whole life cycle of power batteries, the cost advantage of large cylindrical batteries exists.
Q: What do you think of the future development expectation of large cylindrical batteries at the quantitative level?
A: We insist on the large cylindrical battery because the company thinks it represents the future development direction. Judging from the existing exchanges with car companies, mainstream car manufacturers around the world are highly concerned about large cylindrical batteries, and the consensus that large cylindrical batteries will be one of the mainstream power batteries in the future has basically formed. But the real large-scale application still needs time. For example, in the definition of European models, it should be in the fifth or even sixth generation before it will be widely popularized. From the perspective of technology foresight, the company has seized the future growth point and has got a lot of project fixed points at present. It is estimated that it will take two to three years to gradually increase the commercial delivery from now on to the delivery of dozens and hundreds of GWh every year in the future. During this period, the company will continue to increase the delivery of the system among the cooperative customers, so that the market will continue to form an understanding of its outstanding characteristics such as fast charging ability, economy, low temperature performance, and especially structural stability. After a consensus is gradually formed in the industry, our leading edge in technological innovation can be more effectively brought into play.
Q: Does the company have any related measures to improve the management and control ability of the industrial chain to consolidate the cost advantage?
A: The company has done a lot of work in the industrial chain layout in the early stage, and established a joint venture company with the head enterprises in the industry in the main materials of lithium batteries. At present, the focus of work is to operate these joint ventures well and establish strategic cooperative relations with smoother processes. We hope to push forward the above work in a solid way this year, so that in 2024 and beyond, the strategic supply chain can continue to play a role in the delivery quality and cost competitiveness of products. This work is of great significance to the company, especially in the case of local overcapacity in the industry, which has a cost advantage and can ensure the stable development of the company at a relatively good profit level.
Q: A new battery bill has been issued in Europe, which imposes long-term and proportional restrictions on the whole material and the recycling of lithium batteries. What kind of response mechanism does the company have in this regard?
A: Before the company invested in building a battery factory in Europe, it had repeatedly communicated and demonstrated with BMW and other customers for a long time. We have fully interpreted and analyzed the contents involved in the European battery bill, and have taken countermeasures in advance. For example, the bill involves the requirement of localization of supply chain in Europe. At first, customers asked for 70% of the supply chain, and now some customers have further proposed to raise the proportion to 90%. The company has communicated with its partners in the upstream of the industrial chain, and the results are gratifying. All partners are willing to build factories in Europe. One person walks fast and a group of people walk far, so it is certain that the whole supply chain will invest in Europe. Battery recycling, especially ternary battery recycling, is valuable in itself. At present, the company is still communicating with customers to demonstrate that the value of products recovered from batteries should be realized by consumers, or by car factories or battery factories. At present, this problem is still being studied and discussed with customers. In recent years, the company has been preparing and promoting the related work on carbon index, battery passport and other issues involved in the European bill, and it is well prepared. At present, the whole industrial chain of lithium battery goes to Europe to build factories and serve customers in Europe, and the conditions and environment are relatively mature.
Q: What is the proportion and performance of fast-charging batteries in the company’s existing product system?
A: The fast charging ability of the battery is always concerned by the company. The company’s large cylindrical battery can be charged from 20% to 80% in almost 15 minutes, and even reach a higher level. 800V fast charging technology has been applied to G9 cars in Tucki, which can reach 400 kilometers in 10 minutes or 200 kilometers in 5 minutes. The company regards fast charging technology as one of the core competitiveness of its products. In the field of super fast charging technology, we have cooperated with Israel’s StoreDot for nearly 7 years. The company’s soft-packed ternary batteries, lithium iron phosphate batteries and ternary square batteries all have good fast charging ability. The quick charging ability of products is the company’s unique technical feature. The company will continue to strengthen this technology and is confident to do better in the future.
Q: What do you think of 4C fast charging technology of iron and lithium introduced by friends?
A: Ferrous lithium phosphate 4C fast charging technology introduced by Youshang has certain influence on the market. The company thinks this is a very good thing, and it also supports such a technical development direction. It represents the competitive mode in the industry that constantly relies on technological progress to achieve development, rather than just adopting price competition strategy, which is also the fundamental reason for the differentiation between the leading enterprises and other participants in the industry.
Q: Fast charging technology takes 15 minutes to correspond to 4C’s charging capacity. Will there be any price difference between products with 1C, 2C and 3C’s charging capacity?
A: Fast charging technology is an improvement in battery characteristics. Customers will discuss it in the company’s product technology roadmap, and put forward what level of charging capacity needs to be raised at different time nodes. If it fails to meet the requirements of customers, it may not be selected by customers. There is not necessarily a special discount on the price. For example, the fast charging ability is strong, and it is unlikely that the battery will be sold more expensive. Fast charging technology only highlights the technical ability. The OEM will choose the supplier according to whether it has the technical ability. If it fails to meet the requirements, it will not be selected. Therefore, technical ability determines your market opportunities, which will not help the price too much.
Q: The company’s traditional consumer battery business will be under some pressure in the first half of the year, and the gross profit margin will drop by 4 points. What is the expected annual revenue target and profitability of the consumer battery business?
A: In the consumer battery business, the company’s lithium primary batteries and consumer lithium-ion batteries have maintained steady development; The growth of consumer lithium-ion batteries is relatively better this year, especially the primary e-cigarette batteries, which are expected to double, and according to the forecast of the future market, it is not excluded that there will be greater growth potential. The decline in gross profit margin is mainly affected by the decline in demand for small cylindrical batteries. The market of power tools changed greatly last year. Before last year, the power tool market was booming, and manufacturers prepared more stocks. However, after the epidemic ended, the sales of power tools declined precipitously. Therefore, the power tool market has accumulated a large amount of inventory, resulting in a significant decline in battery demand. The market originally expected to complete destocking in the first half of this year. At present, it seems that the time to go to the warehouse will continue for about one quarter. For the company, because the customers it serves are the heads of the industry, it has gradually stepped out of the difficult market period. The sales volume of small cylindrical batteries is also increasing month by month. By the fourth quarter of this year, it is expected that the gross profit margin of products will gradually pick up and return to the previous profit level.
Q: Is the second quarter of the energy storage and power battery industry the worst time? Will there be an inflection point at the industry level from the third quarter? Or is it still weak in the third quarter?
A: At present, some people are pessimistic about the industry, but the company will take a longer view and think that the overall situation is not so bad. Compared with the same period last year, the company’s sales revenue in the first half of the year increased by more than 50%. The three business segments of consumption, energy storage and power battery supported each other and achieved stable development. The company believes that the fourth quarter of this year will be better than the third quarter, and next year will be better than the fourth quarter of this year. This is our judgment. However, judging from the changes in the market, the second quarter of this year is indeed difficult. There are differences in the perception of cold and warm in different enterprises, and the pressure on new entrants will be greater;
Details of participating institutions are as follows: