Ganfeng Lithium (01772.HK) Hotness Analysis: Stock Price Fluctuations and Prospects Amid Supply-Demand Game

Ganfeng Lithium (01772.HK) is a globally leading lithium product manufacturer with a business covering the entire industrial chain of lithium compounds, metallic lithium, and lithium batteries [0]. Recently, this stock has become a popular stock in the Hong Kong market, mainly benefiting from factors such as growing demand for new energy vehicles (new energy vehicle sales accounted for 48.8% in August [0]), breakthroughs in solid-state battery technology, and favorable policies (supply-side reform of lithium batteries by the Ministry of Industry and Information Technology [0]).

However, the stock has seen a significant correction recently: it fell more than 5% in the morning session [3], with a daily drop of 6.56% [6]. Market concerns about overcapacity are one of the main reasons [1]. There are obvious divergences in institutional views: Goldman Sachs downgraded its H-share rating from Neutral to Sell [2], predicting that the benchmark spot price of lithium carbonate in China will drop to $9,500 per ton in the second half of 2025 (14% lower than previous expectations [2]), and pointed out that global lithium production capacity will turn to a 10% surplus in the second half of 2026 [0]. But the company’s chairman is optimistic, believing that if the demand for lithium carbonate grows by more than 30% in 2025, the price may exceed RMB 150,000 per ton [0].

Regarding the industry’s supply-demand pattern, lithium production capacity will still be in a 12% shortage relative to demand in the second half of 2025 [0], but will turn to surplus in 2026 [0]. This shift is the focus of market attention.

1. Time Window of Supply-Demand Game
   : In the short term (2025), lithium demand is still in a growth phase, but long-term (2026) overcapacity risks have emerged. This expectation gap has intensified stock price volatility.
2. Divergence Between Institutional and Corporate Views
   : Goldman Sachs’ pessimistic expectations (based on overcapacity) contrast sharply with the company’s optimistic outlook (based on demand growth exceeding expectations), reflecting market uncertainty about lithium price trends.
3. Supporting Role of the New Energy Vehicle Industry
   : The continuous increase in new energy vehicle sales share (reaching 48.8% [0]) provides a solid foundation for lithium demand, but attention should be paid to the indirect impact of changes in overall vehicle sales (such as continued decline in mainland China’s vehicle sales [4]) on the upstream industry.
4. Dual Drivers of Policy and Technology
   : The supply-side reform policy by the Ministry of Industry and Information Technology and breakthroughs in solid-state battery technology provide momentum for the long-term development of the industry, benefiting leading enterprises [0].

• Downward Pressure on Lithium Prices
  : Goldman Sachs predicts a 14% drop in lithium carbonate prices in the second half of 2025 [2], which may suppress stock price performance in the short term.
• Overcapacity Expectations
  : Global lithium production capacity will turn to a 10% surplus in 2026 [0], which may affect industry profitability in the long term.
• Stock Price Volatility Risk
  : Recent stock price corrections (falling more than 5% [3]) reflect unstable market sentiment; investors need to be alert to short-term fluctuations.

• Growing Demand for New Energy Vehicles
  : The strong growth of the industry (sales share approaching 50% [0]) supports long-term growth in lithium demand.
• Potential for Technological Breakthroughs
  : The development of solid-state battery technology may open up new growth space [0].
• Favorable Policies
  : The supply-side reform policy by the Ministry of Industry and Information Technology may optimize the industry competition pattern, benefiting leading enterprises [0].

In the short term, attention should be paid to lithium price trends and overcapacity concerns; in the long term, it is necessary to track whether demand growth exceeds expectations and technological progress.

As a leading enterprise in the lithium industry, Ganfeng Lithium (01772.HK) currently faces a situation where short-term pressures and long-term opportunities coexist. Short-term challenges include institutional rating downgrades, stock price corrections, and overcapacity concerns; long-term opportunities come from new energy vehicle demand growth, technological breakthroughs, and policy support. Market divergences on its prospects reflect the complex changes in the supply-demand pattern of the lithium industry; investors need to make decisions based on a comprehensive consideration of multiple factors.