simpsonspinballmachine| Citigroup: Upgraded Tianqi Lithium to "Buy" target price rose to HK$42

Citi released a research report saying that based on Tianqi Lithium (09696)'s first-quarter results this year, it will upgrade its rating from "neutral" to "buy" and its target price will be raised from HK$40 to HK$42. The bank estimates that the company will achieve profit starting in the second half of this year, mainly because high-cost spodumene stocks may be consumed from the first quarter to the second quarter of this yearsimpsonspinballmachine; The one-time impact of tax claims on SQM, which holds approximately 22% of its stake, has limited impact on cash flow throughout the year. There is uncertainty about the agreement between SQM and Codelco.

The bank said it would downgrade Tianqi Lithium's net profit forecast for this year from the original forecast of 3.3 billion yuan to a loss of 1.8 billion yuan to take into account SQM's one-time investment income loss and the impact of high-cost spodumene inventories in the first half of this year. After the forecast model was updated, the company's 2025 - 2026 earnings per share forecast was lowered by 1% to 2%. In addition, the bank believes that the spot price of lithium carbonate may have bottomed out in February and recommends that investors gradually increase their holdings in Tianqi Lithium when it is low.