The Domestic Lead-acid leader Expands Lithium Electricity Market

Camel group, the domestic lead-acid leader, is a comprehensively high-tech enterprise specializing in the battery business, whose products mainly include the lead-acid battery, powerful lithium-ion battery, and others widely used in automobiles, electric vehicles, electric bicycles. At the same time, the company also manages the recycling of waste lead-acid batteries, thus it forms a coordinated business pattern of lead-acid battery, new energy, and regenerated lead, in which lead-acid battery is the main business of the company, accounting for more than 90 percent of the sales revenue. With the continuous follow-up of the regenerated lead, the proportion of the its business may gradually rise and the lithium battery business is also expected to benefit from the increased penetration of the 48V electrical system.

Lead-acid batteries are mainly used in the automobile electrical system which has two sets of electrical systems with high voltage and low voltage. The former is mainly used to drive the motor of the automobile and supply power to the high-power subsystem. The latter is usually used to drive the low-power parts such as door switch, lights, and radio, etc. Both of them did not appear at the same time, but increased with the vehicle power. The systems with 6V or 12V cannot meet the demand of automotive power. In 2011, German companies research the 48V system to meet the power demand, which is little overqualified for these parts such as the door, window switches. So 12V systems is still needed to maintain these low power part. And 12V system will always exist in the vehicles due to the 12V system is the first step to drive the relay which will turn on the power battery to make the car electrified.

The 12V system can be supplied by the lead-acid battery and lithium iron phosphate battery. The lead-acid battery is better than lithium battery in the above aspects through the comparison of cost, property, and safety, and maturity of the supply chain, which shows the only disadvantage that the volume and weight of it are larger and heavier under the same power. However, lead-acid battery is still the first choice of the 12V system due to the increased weight and occupied volume is limited, which is not enough to become a pain point. Only in the pursuit of extreme lightweight vehicles will lithium battery be used.

Thanks to the Steady Growth of Car Sales, there is Huge Room for the Development of Lead-Acid Batteries.

The number of the global car has maintained a steady growth in recent years, which is expected to break through 1.5 billion in 2020, while the 12V power supply that will exist in the future automobile electrical system will drive the sustainable development of lead-acid batteries. China is still an emerging auto market with a higher growth rate of car ownership than that of the global average. Relevant data shows that the upper limit of the car ownership in China maybe 580-700 million with the current owner of 240 million, which still has a large growth space. It is expected that the car ownership will increase steadily with a CAGR of 6 percent in the next five years and the market size of lead-acid batteries will reach 6.1 billion USD in 2021.

Concerning that the power battery industry is monopolized by CATL and BYD, and the update of new energy technology in the future, as well as the uncertainty of market and policy, to cultivating core competitiveness is the best choice for Camel group, which takes advantage of its  resources to focus on the development of 48V and 12V small lithium batteries,  cleverly avoiding the fierce competition in the field of power battery. At present, it has formed local merit in the field of low-voltage ASS and developed a series of products of the lithium battery with 12V and 48V, as well as PHEV and Bev battery. Camel carried out cooperation with Nissan on the 48V lithium battery, which possessing a promising prospect.

Relevant Regulations Promote Stop-Start Batteries and 48V Systems, both of which will Become New Growth Points for Camel Group

Affected by the energy limitation and environmental protection policies, the government lowered the limit of fuel consumption of passenger cars, resulting in enterprises focusing on the fuel consumption reduced. Automatic start-stop and 48V system can effectively reduce fuel consumption and is widely favored by the market. It can be proved by the fact that the penetration rate of the auto start-stop system of new cars in China is as high as 70 percent, which is expected to become the standard of fuel vehicles in the future. Besides, from the perspective of cost and fuel-saving efficiency, although the cost of the 48V system is twice as high as other technology of ordinary fuel vehicles, it can offer triple fuel-saving space which means less investment in exchange for higher fuel-saving efficiency. With the continuous improvement of fuel consumption pressure, the global fuel engine will be upgraded to electrification, in which the 48V system is expected to become the mainstream of the electric system in the vehicle. It is expected that the global sales volume of the 48V system will reach 20 million in 2025 with a CAGR of 48V system in the next five years reaching 49 percent. Camel group possessing both 12VAGM, start-stop battery with lead-acid, and 12V, 48V lithium battery. These two aspects conform to the development needs of the current automotive electrical system, which are expected to become a new growth point of Camel group.

It Is Driven by the Environmental Protection Policy with Higher Requirements to Make Regenerated Lead Create New Production Capacity

The introduction of many policies has opened the policy channel for the regeneration of waste lead batteries, which is conducive to the establishment of a closed circular economic system of lead-acid battery production and recovery nationwide. The lead cost of camel shares accounts for 70 percent of the all cost of raw materials. That means it is crucial to build a closed-loop of lead-acid battery industry chain to create more net profits. In 2018, the group had a disposal capacity with 550,000 tons per year of waste lead battery, which is expected to reach 1 million tons to create a new production capacity with 20 tons of lead in 2020.

The Market Scale of Camel Group with Unceasing Expansion and Infinite Potential

Currently, Tesla in China is equipped with the 12V lead-acid battery imported, which tends to achieve complete localization. Camel group, as the largest supplier of the auto start-stop battery in China, has a market share of about 45 percent and 25 percent in the host market and maintenance market, which is most likely to be the supplier of Tesla starter battery in China. Besides, the group invested 150 million USD in Malaysia in 2019 and become in Malaysia the largest auto battery manufacturer that can produce 5 million batteries annually with an output value of 14.3 million USD. It will become a major exporter in Southeast Asia, Africa, and other regions, with market coverage across half the globe.

It is estimated that the annual revenue of Camel group from 2020 to 2022 will increase by 6.3%, 19.8%, and 15% year on year respectively, and the net profit will increase by 7.8%, 21.6%, and 13.1% year on year. Camel group is expected to achieve a net profit of 91 million USD in 2020.