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Copper foil, what do I worry about most?
2020-08-31
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Citic Construction investment securities published a "non-ferrous metal industry: Copper foil, What Do I worry about most?"
Industry research articles, the following is the specific content of the article:

1. How is the copper foil industry doing?

There is a serious shortage of standard copper foil.
According to the copper clad Laminate Association, the monthly shortage is about 3,300 tons, which is slightly higher than our statistical value.
There is no doubt about the serious shortage - some large CCL plants cannot get enough copper foil to meet normal production/expansion needs.
Lithium-ion copper foil is also in short supply.
The new energy vehicle policy has not been implemented for a long time, and the operation and production of downstream enterprises are not normal, especially to change production to meet the requirements of "high energy density", and consumption enters the "off-season" in advance.
But consumer electronics demand is strong and overall remains undersupplied.

Second, policy disturbance may slow down the production pace.

Due to the disturbance of domestic new energy vehicle policies, large investment, long equipment procurement cycle (the price is also soaring), and more stringent environmental protection, the expansion of enterprises is more prudent and rational.
Furthermore, the quality problems of Samsung's mobile phones and the manufacturing of Apple's mobile phones may further migrate to the mainland. Therefore, the expansion of Korean and Taiwan-funded enterprises is obviously much more cautious than that of mainland enterprises.

Third, we must pay attention to the structural demand changes of lithium copper foil.

1. In order to improve the "energy density", the use of thinner lithium copper foil is a general trend, do not exclude the possibility of large-scale spread in 17 years, such as 9 m→8 m,8 m→6 m, higher added value (6 m processing cost has exceeded 70,000 tons,8 m is 45,000 / ton), production and supply more difficult (domestic production of 6 m enterprises for Nord, Lingbao).
2. Overseas copper foil enterprises do not have a strong desire for expansion, and the demand for new lithium copper foil from overseas companies such as Tesla and BMW should not be underestimated. It is inevitable that overseas giants will turn to the development of mainland copper foil enterprises.

4. In 2017, there will be a serious shortage of copper foil (including lithium copper foil and standard copper foil).

It is expected that the copper foil gap will be further expanded in 2017, especially the lithium electric copper foil gap may reach 1000 tons/month.
Compared with the widespread concern about new-energy vehicle policies in the industry, what we are most worried about is that when everything returns to normal, there will be a deeper shortage of copper foil.

Investment advice: Get ahead of the curve and get in the car.

The stock price of copper foil enterprises has reflected the negative impact of the delayed arrival of new energy vehicles, and with the gradual clarity of industrial policies, the stock price will rise steadily.
Go before the curve, seize the "car" opportunity, continue to strongly recommend copper foil leading enterprises, Nord shares, Tongling nonferrous metals.

Risk tips: Risks such as delayed implementation of new energy vehicle policies, significantly lower demand than expected, and enterprise expansion beyond expectations