|Bid||22.98 x N/A|
|Ask||23.00 x N/A|
|Day's Range||21.90 - 23.98|
|52 Week Range||15.18 - 38.38|
|Beta (5Y Monthly)||0.89|
|PE Ratio (TTM)||N/A|
|Earnings Date||Apr 29, 2020|
|Forward Dividend & Yield||0.15 (0.76%)|
|Ex-Dividend Date||Jun 19, 2019|
|1y Target Est||51.00|
The coronavirus pandemic has paused the electric vehicle revolution, forcing producers of battery metal lithium into survival mode with output cuts, expansion delays and sales of major assets. Lithium industry shares have dropped sharply since January as the economic downturn from the pandemic slammed the brakes yet again on the electrification revolution that for years has seemed just around the corner. The holdup will result in a shortage of the white metal available for EV batteries when markets rebound, warned industry analysts, executives and consultants.
Moody's Investors Service has downgraded to Caa1 from B2 Tianqi Lithium Corporation's corporate family rating (CFR). Moody's has also downgraded the senior unsecured rating on the bonds issued by Tianqi Finco Co., Ltd and guaranteed by Tianqi Lithium to Caa2 from B2. "The ratings downgrade reflects Tianqi Lithium's very strained capital structure as a result of its high debt burden, elevated leverage and weak liquidity," says Gerwin Ho, a Moody's Vice President and Senior Credit Officer.
Moody's Investors Service has downgraded to B2 from B1 Tianqi Lithium Corporation's corporate family rating (CFR) and the senior unsecured rating on the bonds issued by Tianqi Finco Co., Ltd and guaranteed by Tianqi Lithium. "The ratings downgrade reflects Tianqi Lithium's reduced financial flexibility as a result of its weakened capital structure, which in turn will raise refinancing risk, in particular with regard to the November 2020 maturity of part of the loan associated with its acquisition of a stake in Sociedad Quimica y Minera de Chile S.A. (SQM, Baa1 stable)," says Gerwin Ho, a Moody's Vice President and Senior Credit Officer. The updated guidance includes an estimated RMB2.2 billion impairment charge related to its 25.9% stake in SQM, which Tianqi Lithium reports as long-term investment on an equity method basis.
(Bloomberg Opinion) -- Tianqi Lithium Corp. had everything going for it: generous subsidies, Beijing’s blessing on the electric-vehicle industry it supplies, and the hype of Tesla Inc. getting its sedans off the production line in China. The only thing interrupting this nice fairy tale is the reality of demand and making money.Over the past few years, China has supported its electric-car industry by doling out large subsidies; giving preferential treatment to domestic companies; and providing large outlays for charging infrastructure. The sector has surged as a result. The kickoff of Tesla’s Model 3 in Shanghai last month sparked a fresh rally among producers of lithium – a key ingredient in batteries – and other suppliers.All this is excitement is bubbling away despite the cratering of the lithium market. After peaking more than a year and a half ago, prices have slumped over 50% and inventories have piled up. The glut, a problem China knows all too well, has weighed on producers.This reality is starting to settle in for Tianqi Lithum. Earlier this week, the company canceled its bondholder meeting as worries about repaying investors 318 million yuan ($46 million) in principal and interest loomed. Its bonds fell to just over 64 cents on the dollar from around 75 cents days earlier.While China reported its first monthly slump in electric-vehicle purchases in July, Tianqi Lithium was struggling before then. The world’s second-largest producer reported its first quarterly loss in almost six years years in September, following two quarters of declining net income.Like many fad-commodity producers before it, Tianqi Lithium is seeing the painful consequences of China’s supply and demand mismatch. The adoption of electric cars and progress on battery technology have both been slower than anticipated. Expectations were so far off the mark that despite lithium prices falling, analysts adjusted higher their estimates for the average selling price of batteries last year.Tianqi Lithium booked a 63% increase in government subsidies in the nine months to September as non-operating income from a year earlier. The government's supportive rhetoric also led the company to pile on debt as it sought stakes in Chile’s Sociedad Quimica y Minera de Chile SA and an Australian lithium mine. The company eventually financed its way to commanding a 16% share of global lithium production; but now its balance sheet looks bloated and questions about the company’s ability to refinance its debt – and at what cost – are becoming more pressing.For all the hopes pegged to its expansion and profitability, Tianqi Lithium didn’t have enough cash to cover the 3.1 billion yuan of short-term debt it owes as of September. The company has already tapped various channels of funding, from medium-term notes to an equity raising. When Moody’s Investors Service downgraded the company last month, it cited Tianqi Lithium’s inability to raise enough capital through its rights offering, saying it would have trouble deleveraging.Expectations for the electric-car industry are starting to recalibrate. With targeted subsidies shifting from cars to batteries and infrastructure, the bargaining power has moved from manufacturers of one to the other. The likes of Geely Automobile Holdings Ltd., BMW AG and Volkswagen AG are locking in long-term contracts and partnerships with battery makers, but these car giants are no longer calling the shots.Battery makers nevertheless face their share of challenges: They haven’t quite figured out how to advance technology safely, while bringing down prices and preserving margins. Any reduction in subsidies will pass through to suppliers as well. It may be time for a more realistic reassessment.Tianqi Lithium may be able to keep rolling over its debt, but that doesn’t change the fact that we’re still years away from widespread adoption of electric cars. A few thousand Teslas on the streets of China isn’t going to change that. EV suppliers may be better served keeping an eye on their balance sheets than Elon Musk’s production line.To contact the author of this story: Anjani Trivedi at firstname.lastname@example.orgTo contact the editor responsible for this story: Rachel Rosenthal at email@example.comThis column does not necessarily reflect the opinion of Bloomberg LP and its owners.Anjani Trivedi is a Bloomberg Opinion columnist covering industrial companies in Asia. She previously worked for the Wall Street Journal. For more articles like this, please visit us at bloomberg.com/opinionSubscribe now to stay ahead with the most trusted business news source.©2020 Bloomberg L.P.
Moody's Investors Service ("Moody's") has completed a periodic review of the ratings of Tianqi Lithium Corporation and other ratings that are associated with the same analytical unit. The review was conducted through a portfolio review in which Moody's reassessed the appropriateness of the ratings in the context of the relevant principal methodology(ies), recent developments, and a comparison of the financial and operating profile to similarly rated peers. This publication does not announce a credit rating action and is not an indication of whether or not a credit rating action is likely in the near future.
Moody's Investors Service ("Moody's") has downgraded to B1 from Ba3 Tianqi Lithium Corporation's ("Tianqi Lithium") corporate family rating and the senior unsecured rating on the bonds issued by Tianqi Finco Co., Ltd and guaranteed by Tianqi Lithium.
China's Tianqi Lithium Corp <002466.SZ>, one of the world's biggest lithium producers, said on Tuesday that its Australian unit had signed a long-term supply agreement with Swedish battery maker Northvolt. Tianqi Lithium Kwinana, which recently launched a processing plant in Western Australia, will supply lithium hydroxide, a chemical used in electric vehicle (EV) batteries, to Northvolt Ett from 2020-25, Tianqi said in a filing to the Shenzhen Stock Exchange.
Moody's Investors Service has downgraded Tianqi Lithium Corporation's corporate family rating and the senior unsecured rating on the bonds issued by Tianqi Finco Co., Ltd and guaranteed by Tianqi Lithium to Ba3 from Ba2. "The downgrades reflect Moody's expectation that Tianqi Lithium's capital structure will remain weak and its leverage will stay elevated over the next 12 months, because of weaker operating performance," says Gerwin Ho, a Moody's Vice President and Senior Credit Officer.
Sweden is turning its gaze towards Peru and other South American countries for lithium tie-ups amid a global race to lock in supply of the "white gold" metal that is key for the batteries that power electric vehicles. A senior trade official from the Scandinavian nation told Reuters by phone that firms in Sweden - which is making a push in such batteries is home to global car brand Volvo - were looking for alliances with regional lithium and copper producers. Governments and automakers around the world, with an eye on huge expected demand for electric cars, are looking to seal tie-ups for the light metal, including in the so-called "lithium triangle" centered on Chile, Bolivia and Argentina.
Moody's Investors Service has assigned a Ba2 corporate family rating to Tianqi Lithium Corporation and has withdrawn the company's Baa3 issuer rating. At the same time, Moody's has downgraded the senior unsecured rating on the bonds issued by Tianqi Finco Co., Ltd and guaranteed by Tianqi Lithium to Ba2 from Baa3.