Core Viewpoint - Huizhou EVE Energy Co., Ltd. is planning to launch an H-share issuance to list on the Hong Kong Stock Exchange, aiming to break the "duopoly" in the lithium battery industry and enhance its global presence [2][3] Group 1: Company Overview - EVE Energy ranks ninth globally in power battery installation volume and second in energy storage cell shipments [2] - The company has expanded its business into three major areas: consumer batteries, power batteries, and energy storage batteries, with production capacities established in Hungary, Malaysia, and the United States [2] Group 2: Financial Performance - In Q1 2025, EVE Energy reported a 37.34% year-on-year increase in revenue to 12.796 billion yuan, while net profit only grew by 3.32%, indicating pressure on profitability due to price wars and heavy asset expansion [3] - The company's operating costs increased by 37.45%, surpassing revenue growth, leading to a significant decline in core business profitability [3] - Total liabilities rose from 59.891 billion yuan at the end of 2024 to 67.249 billion yuan in Q1 2025, a 12.28% increase, with accounts receivable reaching 12.808 billion yuan, representing 314.26% of net profit [3] Group 3: Market Context and Strategic Implications - The upcoming H-share fundraising could potentially raise around 30 billion HKD, which would support the production of new facilities and help manage increased costs from EU regulations [4] - EVE Energy's A-share price-to-earnings ratio of 21.56 times may face pressure due to the lower average P/E ratios in the Hong Kong battery sector, raising concerns about valuation adjustments [4][5] - The company's strategy to diversify into multiple technology routes may lead to resource dilution, which will require time to evaluate its effectiveness [6] Group 4: Industry Dynamics - The lithium battery industry is experiencing intense price competition, with EVE Energy's energy storage battery shipments increasing by 80.54% and power battery shipments by 57.58% [3] - The trend of dual-platform financing (A+H shares) is becoming common among lithium battery companies, with several peers already listed in Hong Kong [4][5] - The global narrative surrounding the industry reflects collective anxiety among Chinese new energy companies, as they face challenges from international competitors and regulatory pressures [6][7]

金十数据6月19日讯， 汇丰环球研究发报告指，中国电动车价格和销量面临挑战，主要受需求冷淡和消 费交易下降所致。因近期新车上市价格普遍低于预售价格，又因夏季通常为淡季，因此该行预期未来几 个月中国电动车的价格环境可能仍会受压。其次，中国电动车正在进行产业整合，故有短暂的波动性。 另外，由於原始设备制造商付款周期缩短，供应商将因此受惠。汇丰见业界定价和产量面临更多挑战， 相对於原始设备制造商，更为青睐稳健的供应商，包括福耀玻璃(03606.HK)、 宁德时代(03750.HK)和拓 普。 汇丰：中国电动车价格和销量面临挑战 未来几个月价格仍会受压 ...

Core Insights - In May 2025, a total of 18 Chinese companies successfully completed IPOs across A-shares, Hong Kong, and US markets, raising a total of 50 billion yuan, with the energy and mining sector leading in fundraising [5][9][21]. Market Analysis - A-shares saw a significant decline in IPO activity, while the Hong Kong A+H listing track continued to gain momentum. The outlook for Chinese companies listing in the US remains uncertain [6][10][25]. - The number of IPOs in May 2025 increased by 38.46% year-on-year but decreased by 25% month-on-month. The total fundraising amount rose by 733% year-on-year and 142.42% month-on-month [9][21]. - The top five fundraising companies for the month included CATL, Hengrui Medicine, Junda Co., Weigao Medical, and Mirxes, with the energy and mining sector being the most concentrated industry for IPOs [7][21]. Performance Metrics - The first-day drop rate for IPOs was 22.22%, with four companies experiencing a decline on their debut [12][13]. - The highest first-day gain was recorded by Tiangong Co. at 411.93%, while the largest drop was by Pigeon Bio at -25.90% [13][14]. Sector and Regional Insights - The energy and mining sector led in fundraising with 346.16 billion yuan, accounting for 69.23% of the total IPO fundraising. The healthcare and advanced manufacturing sectors followed with 114.49 billion yuan and 14.16 billion yuan, respectively [44][50]. - Jiangsu province had the highest number of IPOs at four, while Fujian province led in total fundraising with 332.62 billion yuan [56][57]. Investment and Exit Analysis - In May 2025, 11 companies with VC/PE backing went public, with a total exit return of 12.4 billion yuan, reflecting a year-on-year increase of 67.57% [35][36]. - The average return on investment for VC/PE-backed IPOs was 2.16 times, showing a decline compared to previous periods [35][36]. Policy Developments - The Hong Kong Securities and Futures Commission announced a "Tech Company Fast Track" to facilitate the listing of tech and biotech companies [22][76]. - A series of financial policies were introduced by the People's Bank of China and other regulatory bodies to stabilize the market, including liquidity injections and increased loan quotas [17][78].

Core Viewpoint - EVE Energy aims to maintain its position as a "second-tier leader" in the lithium battery industry and effectively counter "black swan" events by proactively gathering funding sources [1][9][60] Group 1: IPO and Market Response - EVE Energy's announcement of its H-share IPO on the Hong Kong Stock Exchange did not receive a warm response from the capital market, unlike CATL [2][4] - Following the IPO announcement, EVE Energy's A-share price fell nearly 5% from 45.02 CNY to 42.78 CNY [3] - The muted market reaction is attributed to the slowdown in the lithium battery industry and investor concerns over the company's potential funding pressures [6] Group 2: Funding Needs and Global Expansion - The funds raised from the Hong Kong IPO are crucial for EVE Energy, described as a "lifeline" for the company [7] - EVE Energy plans to use the IPO proceeds for overseas factory construction, accelerating global capacity layout, and supplementing working capital [11] - The company has a cash balance of approximately 13.4 billion CNY, but its overseas projects require nearly 17.4 billion CNY, leaving a funding gap of about 4 billion CNY [19] Group 3: Customer Payment Challenges - EVE Energy's core business, power batteries, accounts for nearly 40% of its revenue, with automotive companies as its primary customers [25] - Following the IPO announcement, several automotive companies committed to reducing payment terms to within 60 days, highlighting a significant change in the supply chain [26] - The average accounts payable turnover days for domestic automakers is 171.6 days, significantly higher than the less than 60 days typical for Western brands [28] Group 4: Storage Battery Market and Competition - EVE Energy's storage battery revenue is projected to account for 39.14% of total revenue in 2024, with a shipment target of 50.45 GWh, making it the second-largest globally after CATL [36] - The U.S. market is a key target for EVE Energy, but changes in policy, such as the IRA, pose significant challenges for its downstream customers [38][39] - The bankruptcy of Powin, a major U.S. energy storage integrator and customer, raises concerns about future cooperation and payment uncertainties [40][43] Group 5: R&D Investment and Competitive Pressure - EVE Energy must invest heavily in R&D to keep pace with competitors, with R&D spending increasing from 700 million CNY to 2.942 billion CNY over the past five years [47] - The company plans to launch a pilot line for solid-state batteries by the end of this year, aiming for a 400 Wh/kg energy density by 2028, which lags behind competitors [49][55] - EVE Energy faces intense competition in large-capacity battery cells, with rivals rapidly advancing their technologies [56][58] Group 6: Overall Challenges and Future Outlook - EVE Energy is confronted with multiple challenges, including the need for funding for overseas expansion, risks in accounts receivable, difficulties in the storage market, and pressures from R&D investments [59] - The success of the Hong Kong IPO is critical not only for expanding financing channels but also for supporting overseas expansion and technological advancements [60]

Core Viewpoint - The recent trend of leading A-share companies listing on H-shares is gaining momentum, with several companies successfully completing their listings in Hong Kong, enhancing their international market presence and brand recognition [1][2]. Group 1: H-share Listing Trend - Leading companies like Midea Group, CATL, and Heng Rui Pharmaceutical have recently listed on the Hong Kong Stock Exchange, indicating a growing trend among A-share companies to seek H-share listings [1]. - Stone Technology announced its intention to list on the Hong Kong Stock Exchange, further contributing to the ongoing "H-share boom" [2]. Group 2: Investment Considerations - Investors face a dilemma regarding whether to invest in A-shares or H-shares of companies listed on both exchanges, as each market has distinct advantages and disadvantages [2]. - Analysts highlight that H-shares generally trade at a discount compared to A-shares due to differences in investor structure, liquidity, and refinancing mechanisms [3][5]. Group 3: Price Discrepancies - The long-term price discrepancy between A-shares and H-shares is attributed to the lack of free convertibility and arbitrage mechanisms between the two markets [3]. - Currently, only 155 companies are listed on both A and H-shares, representing a small fraction of the total number of companies on the Hong Kong main board [5][6]. Group 4: Sector Analysis - The majority of companies listed on both exchanges are state-owned enterprises and belong to traditional economic sectors, such as finance and energy, which tend to attract dividend-focused investors [6]. - The analysis suggests that the price differences between A and H-shares can be better understood through a dividend perspective rather than purely market sentiment [6]. Group 5: Recent Market Dynamics - The phenomenon of "A-H share price inversion" has been observed, particularly with companies like CATL, where H-shares traded at a premium to A-shares, indicating a shift in market dynamics [7][9]. - The current macroeconomic environment and differing investor preferences contribute to the observed price behaviors between A and H-shares [9][10]. Group 6: Future Outlook - Companies like Stone Technology, which have a significant portion of their revenue from overseas markets, are expected to attract foreign investment and may experience similar price dynamics as seen with CATL [12][13]. - The ongoing trend of high dividend yields in the Hong Kong market, coupled with structural opportunities in sectors like new consumption and technology, positions H-shares favorably for investors [16][17].

Core Viewpoint - HSBC initiates coverage on CATL (宁德时代) with a target price of HKD 359 and maintains a buy rating for its A-shares at RMB 322, highlighting the company's strong market position and resilience in the face of industry challenges [1] Group 1: Company Performance - In the previous year, CATL's operating profit accounted for 87% of the entire domestic electric vehicle battery supply chain industry, demonstrating its dominant market position [1] - Despite the onset of a price war in the electric vehicle sector and a decline in lithium prices starting in 2022, CATL's operating profit remains resilient [1] Group 2: Industry Outlook - The anticipated oversupply issue in the electric vehicle industry is expected to have a limited impact on CATL, with high utilization rates projected to sustain profit margins during industry consolidation [1] - CATL is increasing its market share in overseas markets and building production capacity abroad, which will help mitigate challenges posed by tariffs on domestic suppliers [1] - The proportion of CATL's overseas production capacity is expected to rise from 2% in 2024 to 10% by 2027, indicating a strategic expansion in international markets [1]

Core Insights - The article highlights the top and bottom AH share premium rates as of June 10, with Northeast Electric (00042) leading at a premium rate of 958.82% and Ningde Times (03750) at the bottom with -1.75% [1][2]. Group 1: Top AH Share Premium Rates - Northeast Electric (00042) has a premium rate of 958.82% with H-share priced at 0.255 HKD and A-share at 2.25 CNY [2]. - Hongye Futures (03678) follows with a premium rate of 271.39%, H-share at 3.390 HKD and A-share at 10.51 CNY [2]. - Andeli Juice (02218) ranks third with a premium rate of 268.02%, H-share at 15.980 HKD and A-share at 49.1 CNY [2]. Group 2: Bottom AH Share Premium Rates - Ningde Times (03750) has a premium rate of -1.75%, with H-share at 299.600 HKD and A-share at 245.75 CNY [2]. - WuXi AppTec (02359) has a premium rate of 5.05%, H-share at 74.000 HKD and A-share at 64.9 CNY [2]. - China Merchants Bank (03968) has a premium rate of 5.13%, H-share at 50.900 HKD and A-share at 44.67 CNY [2]. Group 3: Top Share Deviation Values - BYD Company (01211) leads with a deviation value of 202.33%, H-share at 135.600 HKD and A-share at 353.13 CNY [2]. - Longpan Technology (02465) follows with a deviation value of 30.49%, H-share at 6.910 HKD and A-share at 15.33 CNY [2]. - Yanzhou Coal Mining (01171) has a deviation value of 11.04%, H-share at 8.250 HKD and A-share at 12.79 CNY [2]. Group 4: Bottom Share Deviation Values - China Shipbuilding Defense (00317) has the lowest deviation value at -46.55%, H-share at 13.360 HKD and A-share at 24.9 CNY [3]. - Zhejiang Shibao (01057) follows with -37.20%, H-share at 4.650 HKD and A-share at 11.93 CNY [3]. - Junshi Biosciences (01877) has a deviation value of -35.39%, H-share at 24.600 HKD and A-share at 37 CNY [3].

Group 1 - The top three companies with the highest short positions as of May 30 are WuXi AppTec (02359), Ganfeng Lithium (01772), and Vanke Enterprises (02202), with short ratios of 18.00%, 12.91%, and 12.55% respectively [1][2] - The companies with the largest absolute increase in short positions are CATL (03750), Chongqing Rural Commercial Bank (03618), and Suoteng Juchuang (02498), with increases of 5.21%, 2.72%, and 1.58% respectively [1][2] - The companies with the largest absolute decrease in short positions are COSCO Shipping Energy (01138), Shanghai Pharmaceuticals (02607), and Rongchang Biologics (09995), with decreases of -4.81%, -3.64%, and -0.78% respectively [1][3] Group 2 - The top ten companies with the highest short ratios include Shandong Gold (01787) at 12.46%, COSCO Shipping Holdings (01919) at 12.39%, and CATL (03750) at 11.89% [2] - The companies with the most significant increase in short ratios include CATL (03750) from 6.68% to 11.89%, Chongqing Rural Commercial Bank from 4.46% to 7.19%, and Suoteng Juchuang (02498) from 1.51% to 3.09% [2] - The companies with the most significant decrease in short ratios include COSCO Shipping Energy (01138) from 10.90% to 6.08%, Shanghai Pharmaceuticals (02607) from 6.49% to 2.85%, and Rongchang Biologics (09995) from 5.37% to 4.59% [3][4]

Investment Rating - The report initiates coverage with an "Outperform" rating for CATL, with a target price of HK$382 [2][6]. Core Insights - CATL has maintained its position as the global leader in power lithium batteries since 2017, achieving an installed power battery capacity of 339.3 GWh in 2024, with a market share of 37.9% [3][51]. - The company has a comprehensive supply chain layout that mitigates risks associated with raw material price volatility, securing control over critical mineral resources through various investment strategies [4][52]. - Heavy investment in R&D has led to the continuous development of competitive products, including the Kirin Battery and Tianheng Energy Storage System, enhancing the company's market leadership [5][53]. - Revenue forecasts for 2025-2027 are projected at RMB 460.9 billion, RMB 570.9 billion, and RMB 676.9 billion, with net profits of RMB 55.8 billion, RMB 73.1 billion, and RMB 87.3 billion respectively [6][54]. Summary by Sections Company Overview - CATL was established in 2011 and became the global leader in power lithium batteries in 2017, with significant milestones including its listing on the Hong Kong Stock Exchange in 2025 [10][12]. Financial Performance - The company experienced rapid revenue growth from RMB 29.61 billion in 2018 to RMB 328.59 billion in 2022, with a CAGR of approximately 82.52% [12][15]. - In Q1 2025, CATL reported revenue of RMB 84.705 billion, a year-on-year increase of 6.18% [12]. Industry Landscape - The global demand for lithium batteries is driven by the increasing penetration of electric vehicles, with global sales of new energy vehicles expected to reach 22.4 million units by 2025 [23][24]. Supply Chain and Innovation - CATL's integrated supply chain strategy includes investments in upstream resources and partnerships for battery materials, enhancing its competitive edge [4][39]. - The company has established a circular economy model through its Brunp Integration Park, focusing on resource recycling and sustainability [4][42]. Valuation and Forecast - The DCF valuation model supports a target price of HK$382 for CATL, reflecting strong growth potential in the renewable energy sector [6][54].

Investment Rating - The report initiates coverage with an "Outperform" rating for CATL [2][6]. Core Views - CATL has maintained its position as the global leader in power lithium batteries since 2017, with a market share of 37.9% in 2024, significantly outpacing competitors [3][51]. - The company has a comprehensive supply chain layout that mitigates risks associated with raw material price volatility, ensuring control over critical resources [4][52]. - Heavy investment in R&D has led to a continuous stream of innovative products, enhancing CATL's competitive edge in the market [5][53]. - The financial forecast indicates substantial revenue growth, with projected revenues of RMB 460.9 billion, RMB 570.9 billion, and RMB 676.9 billion for 2025, 2026, and 2027 respectively [6][54]. Summary by Sections Company Overview - CATL was established in 2011 and became the global leader in power lithium batteries in 2017, with significant milestones including its listing on the Hong Kong Stock Exchange in 2025 [10][12]. Market Position - The company achieved a power battery installed capacity of 339.3 GWh in 2024, with a market share increase to 37.9% [3][24]. - The global demand for electric vehicles is expected to drive further growth, with projections of 22.4 million units sold globally by 2025 [23]. Supply Chain and Risk Management - CATL has established a robust supply chain through various strategies, including investments in upstream resources and partnerships for battery materials [4][39]. - The company has developed a circular economy model through its Brunp Integration Park, enhancing its resource recycling capabilities [4][42]. Financial Performance - The report highlights a significant increase in revenue from RMB 296.11 billion in 2018 to RMB 3285.94 billion in 2022, with a projected revenue of RMB 847.05 billion in Q1 2025 [12][18]. - The net profit is expected to grow from RMB 55.8 billion in 2025 to RMB 87.3 billion in 2027, reflecting a strong profit margin [6][54]. Valuation - Based on a DCF valuation model, the target price for CATL is set at HK$382, indicating a favorable investment opportunity [6][54].