9696.HK
TIANQI LITHIUMClosed9696.HK discounted cash flow valuation
9696.HK Fair Value
Reverse DCF: today's price implies -3.5% a year of FCF growth for years 1–5, against -5.0% in this model.
Model: -5.0% from analyst next-year EPS & revenue growth (capped). Fades linearly to terminal growth by year 10.
Model: 7.29% (CAPM, see the build-up).
Long-run growth after year 10; keep it at or below nominal GDP.
Value Bridge
| PV of free cash flow, years 1–10 | HKD 4.77B |
|---|---|
| PV of terminal value (59% of EV) | HKD 6.75B |
| Enterprise value | HKD 11.52B |
| + Cash & investments | HKD 13.85B |
| − Total debt | −HKD 20.54B |
| Equity value | HKD 4.83B |
| ÷ Shares outstanding | 236.15M |
| Value per share | HKD 20.45 |
| Market cap | HKD 43.10B |
CNY statements converted at 1.172 HKD.
Discount Rate Build-up
| Risk-free rate (10-yr Treasury) | 5.22% |
|---|---|
| Beta (clamped 0.5–2.5) | 0.73 |
| Equity risk premium | 5.00% |
| Cost of equity (CAPM) | 8.88% |
| Pre-tax cost of debt | 5.22% |
| Tax rate | 24.4% |
| Debt / (equity + debt) | 32.3% |
| WACC | 7.29% |
Cost of debt is interest expense ÷ total debt, held between the risk-free rate and 12%.
Free Cash Flow: History and Projection
Sensitivity: Value per Share
| WACC ↓ / g → | 1.50% | 2.00% | 2.50% | 3.00% | 3.50% |
|---|---|---|---|---|---|
| 5.29% | 35.55 | 42.95 | 53.00 | 67.44 | 89.94 |
| 6.29% | 22.83 | 27.08 | 32.45 | 39.45 | 48.96 |
| 7.29% | 14.49 | 17.19 | 20.45 | 24.47 | 29.55 |
| 8.29% | 8.58 | 10.41 | 12.56 | 15.12 | 18.21 |
| 9.29% | 4.17 | 5.48 | 6.98 | 8.72 | 10.75 |
Green is above today's price, red below (full colour at ±30%). The outlined centre cell is the current inputs.
Projected Cash Flows
| Year | Growth | Free cash flow | Discount factor | Present value |
|---|---|---|---|---|
| Base (TTM) | — | HKD 846.13M | — | — |
| Year 1 | -5.0% | HKD 803.82M | 0.932 | HKD 749.20M |
| Year 2 | -5.0% | HKD 763.63M | 0.869 | HKD 663.38M |
| Year 3 | -5.0% | HKD 725.45M | 0.810 | HKD 587.39M |
| Year 4 | -5.0% | HKD 689.18M | 0.755 | HKD 520.11M |
| Year 5 | -5.0% | HKD 654.72M | 0.703 | HKD 460.53M |
| Year 6 | -3.5% | HKD 631.80M | 0.656 | HKD 414.21M |
| Year 7 | -2.0% | HKD 619.17M | 0.611 | HKD 378.35M |
| Year 8 | -0.5% | HKD 616.07M | 0.570 | HKD 350.88M |
| Year 9 | 1.0% | HKD 622.23M | 0.531 | HKD 330.31M |
| Year 10 | 2.5% | HKD 637.79M | 0.495 | HKD 315.56M |
Method
Two-stage free-cash-flow model, the same as the bot's lgf dcf: five years at the chosen growth rate, a straight-line fade to terminal growth by year ten, then a Gordon-growth terminal value. Everything is discounted at WACC.
Base cash flow is the trailing four quarters of operating cash flow minus capital expenditure (the latest fiscal year when quarters are missing). Default growth uses analyst long-term growth when Yahoo publishes it, else the average of next year's EPS and revenue growth, else revenue CAGR, held between −5% and 25%.
A DCF is only as good as its inputs. The terminal value is usually most of the answer, so read the sensitivity grid before the headline number. This is a model, not investment advice.