Morgan Stanley pointed out that China's lithium prices have stabilized, benefiting from expected demand and potential supply blockages since this year. Cathode and battery orders in March beat market expectations, and April orders continued to increase by about 10%, providing support for lithium prices. Coupled with market expectations that production of the raw material lepidomite may be suspended in April due to environment-related investigations, lithium prices have stabilized. The bank believes that there will still be excess lithium supply this year, but the excess situation is shrinking, and lithium prices may face downward pressure when concerns about the blockage of the lepidomite supply end. The bank also said that sales channels showed that the price of 80 to 100 yuan of carbonate per metric ton was the cost support level for China's lepidophilus and African supplies.
The bank viewed the weak stock prices of Tianqi Lithium and Ganfeng Lithium in the second half of the year as an opportunity to absorb, based on the lithium resources they have. The bank renewed the H share rating of Tianqi Lithium and Ganfeng Lithium. Tianqi Lithium's target price for H shares was raised from HK$51 to HK$52, while Ganfeng Lithium's target price for H shares was reduced from HK$33 to HK$29.