The demand for lithium batteries has soared, and the leading effect has accelerated

Benefiting from the global battery expansion logic, lithium battery equipment will be strong. Industry insiders believe that, at present, domestic equipment companies can meet the requirements in terms of production capacity, delivery time, technology, and services. As battery costs drop, the localization and leading of the entire equipment industry is an inevitable trend. Optimistic about investment opportunities in the sector, it is recommended to focus on investment opportunities in key materials for lithium batteries. Explosive growth in demand Under the global wave of electric vehicles, my country's new energy vehicle industry has shown explosive growth in recent years, driving my country's power battery industry into a period of rapid expansion. Under the guidance of the double-point policy, the future penetration rate of new energy vehicles will steadily increase, and the demand for power lithium batteries will play a continuous pulling role. According to statistics from the China Association of Automobile Manufacturers, the production and sales of new energy vehicles in my country from January to October 2018 were 879,000 and 860,000 units, a year-on-year increase of 70.02% and 75.51% respectively. From the perspective of a single month, the production and sales of new energy vehicles in October were 1.46 and 13,800 units, a year-on-year increase of 58.70% and 51.65% respectively. In November 2018, my country's new energy vehicle sales were 169,000, a year-on-year increase of 42.02%. Combining the introduction of multiple batches of catalogues and the characteristics of the industry, sales are expected to remain high in December, with annual sales expected to exceed 1.15 million vehicles, significantly exceeding expectations. Benefit from the rapid development of my country's new energy automobile industry. Since 2018, my country's total installed power battery capacity has increased significantly year-on-year, with a cumulative year-on-year increase of 97% from January to October to 34.71GWh. The industry generally believes that the rapid growth in demand will drive the prosperity of related lithium battery materials. Moreover, due to the downstream influence this year, the order situation is relatively flat. Next year is expected to usher in the next wave of expansion cycle, and orders are expected to improve next year. The leading effect accelerates. According to Lianxun Securities, the market pattern of various links in the domestic power lithium battery industry chain has been initially formed, and the threshold for new entrants has been greatly improved compared with previous years. In the future, small and medium-sized companies will be gradually eliminated, and the market structure will eventually be formed. It is recommended to pay attention to leading enterprises in the industry chain. China Development Bank Securities also believes that although the subsidy decline has brought a certain degree of operating pressure to the entire new energy automobile industry chain, from the perspective of supply and demand, leading power battery companies still have a strong endogenous motivation for expansion. According to the statistics of lithium battery big data, only 15 domestic mainstream battery companies will expand their production scale to reach 166GWh in 2018-2020. With an investment of 1GWh lithium battery equipment of 300-400 million yuan, the incremental market for lithium battery equipment driven by the expansion of 15 companies The space is about 50-66 billion yuan. According to the analysis of Cui Guotao, an analyst at China Development Bank Securities, under the trend of increasing concentration in the power lithium battery market, equipment companies that rely on technological advantages and battery leaders to form a first-mover advantage; companies with the ability to provide complete solutions can improve their current Have customer stickiness, speed up the development of new customers, and increase market share. Since November, the market's expectations for lithium batteries and even new energy vehicles have been heating up. Data show that in November, the lithium battery sector index rose 8.79%, the new energy vehicle index rose 5.40%, while the Shanghai and Shenzhen 300 index fell by 0.14% over the same period, both significantly outperformed the Shanghai and Shenzhen 300 index. Centaline Securities believes that the significant decline in the lithium battery and new energy vehicle index in the early period has already had a certain valuation advantage, and the prices of some upstream raw materials such as lithium carbonate are showing signs of stabilization. The sector and some individual stocks already have certain advantages in valuation. Combining policy guidance, segmented field prices and competitive landscape, it is expected that there will still be investment opportunities in the sector.