Investment Rating - The industry is rated as "Outperform" compared to the market [2]. Core Views - The demand for energy storage lithium batteries is strong, and the prices of lithium battery materials are rising moderately [6]. - In October 2025, domestic battery production reached 170.6 GWh, a year-on-year increase of 50.84% and a month-on-month increase of 12.83% [6][2]. - The production of lithium iron phosphate (LFP) cathode materials in October 2025 was 266,900 tons, up 45.92% year-on-year and 8.36% month-on-month, with a capacity utilization rate of 63.54% [6][2]. - The prices of key raw materials have generally increased, with industrial-grade lithium carbonate exceeding 92,400 yuan/ton, a weekly increase of 10.13% [7][2]. - The monthly loading volume of LFP batteries in October 2025 was 67.5 GWh, a year-on-year increase of 43.62% and a month-on-month increase of 8.52% [15][2]. - The export volume of Chinese power batteries in October 2025 was 19.4 GWh, a year-on-year increase of 79.63% [21][2]. Summary by Sections Production - In the first ten months of 2025, domestic battery and LFP cathode material production significantly exceeded the same period in 2024 [6][2]. Prices - The prices of lithium battery raw materials have generally risen, with LFP prices at 38,100 yuan/ton and lithium hexafluorophosphate prices reaching 160,000 yuan/ton [7][2]. Domestic Demand - The monthly loading volume of LFP batteries reached a record high in October 2025, indicating strong domestic demand [15][2]. Overseas Demand - The global sales of new energy vehicles reached 2.1078 million units in September 2025, reflecting a year-on-year growth of 23.53% [21][2].

Overall Viewpoint - Hydrogen ammonia and methanol, along with wind power, are expected to attract more investment due to the dual benefits of China's future industries and the EU carbon tariff in 2026. The global shipping industry is accelerating its decarbonization, and the International Maritime Organization (IMO) is promoting green fuel policies, which may keep green methanol prices high amid rising demand and limited supply. The current market expectations for the hydrogen ammonia and methanol sector are low, which can resonate with the wind power sector [4] - The ongoing electricity shortage in the U.S. is highlighted, with Nvidia's current shipment scale corresponding to data center power levels. The gap between actual power supply and grid capacity in the U.S. is a key focus for market speculation. Short-term fluctuations in stock prices are influenced by interest rate expectations and short-selling, but technology remains the main trend, with a focus on opportunities for rebounds in the overseas energy storage and SST sectors [4] Domestic Energy Storage - Heilongjiang Province has released a special implementation plan for large-scale new energy storage construction (2025-2027), aiming for an installed capacity of over 6GW by 2027. The first batch involves 1.45GW, with a reliable capacity compensation mechanism being established. Provinces are improving capacity price compensation mechanisms to ensure financing for independent energy storage. It is anticipated that independent energy storage bidding in 2026 will maintain a good level similar to 2025, and as the industry develops, independent storage will achieve a complete revenue model through energy, capacity, and ancillary service markets. After 2027, the growth of independent energy storage installations will align closely with load growth [5] Lithium Battery - The market is currently speculating on the production expectations for domestic energy storage in 2026, with short-term positive expectations remaining unchallenged. Growth expectations for power batteries and overseas energy storage are consistent. Additionally, the lithium battery supply chain is experiencing a "reverse involution" logic, indicating a trend of supply-demand improvement. From the perspective of supply-demand tightness in the supply chain, lithium hexafluorophosphate is the most constrained, followed by separators, copper foil, high-pressure lithium iron phosphate, and anodes. Short-term expectations for lithium hexafluorophosphate are already high, and subsequent stages are gradually entering long-term contract signing. Mid-term investment opportunities should focus on lithium mines with significant supply variability and separator segments where profitability does not support expansion [5]