CATL(SZ:300750) CSC SECURITIES (HK) LTD·2025-04-15 07:37Investment Rating - The report assigns a "Buy" rating for the company, indicating a potential upside of 15% to 35% from the current price [4][12]. Core Insights - The company reported a strong Q1 2025 performance with revenue of RMB 847 billion, a year-over-year increase of 6.2%, and a net profit of RMB 139.6 billion, reflecting a 32.9% increase year-over-year [9]. - The overall market demand for power batteries and energy storage batteries is expected to grow by 30% year-over-year in 2025, positioning the company as a leading player in the industry [9]. - The company is actively expanding its overseas market presence, with significant growth in Europe and successful projects in the Middle East and Australia [9]. Company Overview - Industry: Electrical Equipment [3] - A-share price as of April 14, 2025: RMB 224.00 [3] - Market capitalization: RMB 874.173 billion [3] - Major shareholder: Xiamen Ruiting Investment Co., Ltd. (23.27%) [3] - Earnings per share (EPS) for Q1 2025: RMB 3.18 [9] Financial Performance - Projected net profits for 2025, 2026, and 2027 are RMB 646 billion, RMB 740 billion, and RMB 844 billion, respectively, with year-over-year growth rates of 27%, 15%, and 14% [9][11]. - The company’s gross margin for Q1 2025 was 24.4%, an increase of 1.2 percentage points year-over-year [9]. - The company’s financial expenses decreased significantly by RMB 2.6 billion year-over-year due to foreign exchange gains [9]. Market Position and Strategy - The company has a strong market share in Europe, achieving a 43% market share with a year-over-year sales increase of over 20% [9]. - The establishment of overseas factories, such as the one in Germany, is expected to enhance local production and sales [9]. - The company is also focusing on energy storage projects in the Middle East and Australia, with significant contracts already secured [9].