The Zhitong Finance App learned that UBS released a research report saying that Ganfeng Lithium (01772)'s third quarter results fell short of the bank's and market expectations. Investors are expected to respond negatively to the third quarter results and maintain a “buy” rating and target price of HK$44.28.
Ganfeng Lithium announced its results for the first nine months of 2026, with net profit of RMB 5,012 billion, reaching 65% of the bank's forecast for the full year of 2026; net profit for the third quarter was 755 million yuan, up 36% year on year and down 69% from quarter to quarter, lower than the bank and market expectations.
The bank pointed out that lower performance expectations were mainly due to falling lithium carbonate sales prices in the third quarter, which were delayed and mismatched with inventory costs of higher priced spodumene, which is estimated to have caused a loss of about 630 million yuan, which explains most of the gap with market expectations. Furthermore, investment income declined quarterly, mainly due to weakening profits of the associated company Mt Marion, a high sales revenue base for Pilbara in the second quarter, and seasonal factors.
The company said in an analysts' conference call that the outlook is largely unchanged, production expansion plans are still progressing according to schedule, and capital expenditure is expected to increase next year, depending on the scope of PPG financing and Mariana upgrades. Management believes that the price of lithium carbonate is close to the bottom, and the risk is on the upside.