HTSC·2026-01-21 02:50Investment Rating - The report maintains a "Buy" rating for several companies in the lithium battery supply chain, including Ningde Times, Yiwei Lithium Energy, and others, while recommending "Overweight" for companies like Dongsheng Technology [8][11]. Core Insights - The German government announced a €3 billion subsidy program for electric vehicle purchases, providing up to €6,000 per household to stimulate the electric vehicle industry, particularly benefiting pure electric vehicles and low-income families [1][2]. - The policy is expected to drive new electric vehicle demand between 0 to 800,000 units, translating to an additional battery demand of 0 to 48 GWh, which represents approximately 0 to 1.7% of the global battery demand in 2026 [3]. - The report highlights the potential for increased lithium battery demand, particularly benefiting companies with significant exposure to the European market, such as Ningde Times and Yiwei Lithium Energy [3]. Summary by Sections Policy Objectives - The policy emphasizes the environmental benefits and economic viability of electric vehicles, aiming to promote their adoption and support the automotive industry in Germany and Europe [10]. - Households with an annual income below €90,000 can apply for subsidies, which vary based on income and number of children, with higher subsidies for pure electric vehicles [10]. Expected Impact - The subsidy program is anticipated to enhance the penetration rate of pure electric vehicles, with the government expecting to allocate funds for the purchase of 800,000 vehicles [10]. - The report forecasts that the demand for lithium batteries will increase, leading to performance growth for companies in the lithium battery supply chain [3][10]. Company Recommendations - Ningde Times (300750 CH): Target price of 566.18, rated "Buy" due to strong performance and market demand [11]. - Yiwei Lithium Energy (300014 CH): Target price of 96.96, rated "Buy" based on expected volume and profit growth [11]. - Dongsheng Technology (300073 CH): Target price of 75.57, rated "Overweight" due to positive developments in product lines [11]. - Hunan Youneng (301358 CH): Target price of 112.98, rated "Buy" due to strong earnings forecast [11]. - Shangtai Technology (001301 CH): Target price of 130.32, rated "Buy" based on anticipated demand growth [11].