Company Coverage
Ganfeng Lithium (1772 HK): 2Q26: Results Beat, But Price Guidance Cut Clouds Outlook
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
HK$41.10
HK$75.00
+82.5%
HK$120.00
Analyst
Highlights
2Q26 margin beat expectations. 2Q26 GAAP net profit surged to Rmb2.4b, reversing from a loss in 2Q25. Gross margin expanded to 32.7%, driven by lithium product ASP spikes and cost control.
Management has cut its guidance for lithium carbonate prices from its prior >Rmb200,000/tonne, on an expected 20-25% global supply growth in 2027 that would result in a balanced market.
We raise 2026 net profit estimate by 23% on margin strength, but cut 2027 28 forecasts by 1%/11% on lower ASP assumptions. Maintain BUY and cut target price from HK$120.00 to HK$75.00.
Analysis
2Q26 results beat estimates on margins. Ganfeng Lithium’s (Ganfeng) 2Q26 GAAP net profit and adjusted net profit came in as expected at Rmb2,420m (+31.7% yoy) and Rmb2,429m (+71.2% qoq) respectively, vs GAAP net loss of Rmb175m and adjusted net loss of Rmb671m in 2Q25. This takes 1H26 GAAP net profit and adjusted net profit to Rmb4,257m and Rmb3,848m respectively, accounting for 57% and 51% of our full-year estimates. The beat stemmed from margins.
Revenue tripled yoy in 2Q26, primiarily driven by ASP spikes. Revenue surged to Rmb13.9b (+201.9% yoy/+51.2% qoq) in 2Q26 and Rmb23.1b (+175.7% yoy) in 1H26, vs our full-year estimate of Rmb52.29b. In 1H26, sales revenue of lithium products grew 198.5% yoy to Rmb14.2b in 1H26 on a sales volume of around 100,000 tonne lithium carbonate equivalent (LCE) (+25% yoy) and ASP of Rmb142,000/tonne LCE (+140% yoy); battery sales revenue grew 163% yoy to Rmb7.83b on sales volume of around 20GWh (+100% yoy) and ASP of Rmb0.39 (+32% yoy).
Highlights
2Q26 margin beat expectations. 2Q26 GAAP net profit surged to Rmb2.4b, reversing from a loss in 2Q25. Gross margin expanded to 32.7%, driven by lithium product ASP spikes and cost control.
Management has cut its guidance for lithium carbonate prices from its prior >Rmb200,000/tonne, on an expected 20-25% global supply growth in 2027 that would result in a balanced market.
We raise 2026 net profit estimate by 23% on margin strength, but cut 2027 28 forecasts by 1%/11% on lower ASP assumptions. Maintain BUY and cut target price from HK$120.00 to HK$75.00.
Analysis
2Q26 results beat estimates on margins. Ganfeng Lithium’s (Ganfeng) 2Q26 GAAP net profit and adjusted net profit came in as expected at Rmb2,420m (+31.7% yoy) and Rmb2,429m (+71.2% qoq) respectively, vs GAAP net loss of Rmb175m and adjusted net loss of Rmb671m in 2Q25. This takes 1H26 GAAP net profit and adjusted net profit to Rmb4,257m and Rmb3,848m respectively, accounting for 57% and 51% of our full-year estimates. The beat stemmed from margins.
Revenue tripled yoy in 2Q26, primiarily driven by ASP spikes. Revenue surged to Rmb13.9b (+201.9% yoy/+51.2% qoq) in 2Q26 and Rmb23.1b (+175.7% yoy) in 1H26, vs our full-year estimate of Rmb52.29b. In 1H26, sales revenue of lithium products grew 198.5% yoy to Rmb14.2b in 1H26 on a sales volume of around 100,000 tonne lithium carbonate equivalent (LCE) (+25% yoy) and ASP of Rmb142,000/tonne LCE (+140% yoy); battery sales revenue grew 163% yoy to Rmb7.83b on sales volume of around 20GWh (+100% yoy) and ASP of Rmb0.39 (+32% yoy).
BUY (Maintained)
Current price:
Target price:
Upside:
Previous TP :
HK$41.10
HK$75.00
+82.5%
HK$120.00
Analyst
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