Original source：华泰证券First published on Unhidea：Original source date：
Key takeaway
Huatai Securities believes that the pass-through of LFP price increases and cost reductions from integration are improving Fulin Precision’s profitability, while capacity expansion and the robotics electric joint project are aimed at meeting future demand growth.
Why did LFP profitability improve markedly?
In the third quarter of 2026, the company sold approximately 120 thousand tonnes of LFP materials and earned net profit of about 3000 yuan per tonne, a marked quarter-on-quarter improvement. The main reasons were the completed pass-through of higher prices for raw materials such as phosphoric and oxalic acids, production at or above capacity at the Shehong and Yichun bases, and the successful commissioning of the De’a project.
Huatai Securities believes that as applications such as fast charging penetrate the market more rapidly, demand for high-compaction LFP will rise and the product can command a market premium. The company’s advantages in technology, customers and costs are expected to help it benefit.
How will capacity expansion and cost reductions affect future profitability?
As of the end of the third quarter of 2026, the company’s construction in progress reached 3.8 billion yuan, mainly due to increased investment in expanding lithium battery cathode material capacity. The company is accelerating LFP capacity construction to support customer demand.
The company uses a differentiated ferrous oxalate process, works closely with leading battery manufacturers and is pursuing upstream integration. Huatai Securities expects profitability to remain stable or improve as integration-driven cost reductions materialize and the product mix improves.
How are the auto parts and robotics businesses progressing?
In the third quarter of 2026, auto parts revenue was 940 million yuan, up 6% quarter on quarter. Traditional business revenue stabilized quarter on quarter, while the suspension and thermal management businesses continued to grow.
In an announcement in October, the company said its subsidiary Banqiao Intelligent plans to invest in a robotics intelligent electric joint project in Mianyang. Total planned investment is 500 million yuan, with construction in two phases. The first phase will build production lines for electric joints and core components. The company expects annual capacity of 2 million sets to meet demand for volume deliveries.
