Tianqi Lithium Industries Inc Class A

002466: XSHE (CHN)

Morningstar Rating for Stocks	Fair Value	Economic Moat	Capital Allocation
	¥26.60	Dbwzqh	Cymsvkpx

Tianqi’s Strong Preliminary Q3 Results Reinforce Our Positive View; Maintain HKD 102 FVE

Vincent Sun

Oct 17, 2022

Narrow-moat Tianqi reported stronger-than-expected preliminary third-quarter results, with the midpoint of first nine-months net profit accounting for 82% of our full-year profit forecast and 87% of PitchBook consensus. Significant profit growth was mainly due to robust demand for lithium compounds for new energy vehicles. We maintain our fair value estimate at HKD 102 (CNY 92), which implies a 2023 P/E ratio of 7.0 times. The H-shares, at 45% discount to its A-shares and 39% discount to our fair value estimate, are attractive, in our view, but the A-shares are fairly valued.

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