Investment Rating - The report maintains a "Buy" rating for Hyperstrong with a 12-month target price of Rmb 106 per share, indicating an upside potential of 17.9% from the current price of Rmb 89.88 [15][10][3] Core Insights - The Battery Energy Storage System (BESS) is emerging as a critical solution for managing electricity grid stability during summer heatwaves in China, with record peak loads reaching 1,465 GW, an 11% year-over-year increase [1] - Hyperstrong is identified as a key beneficiary of the growing BESS demand, with projected volume growth rates of 65% in 2025, 43% in 2026, and 36% in 2027, leading to an estimated 38% EPS CAGR from 2024 to 2027 [3][13] - The cumulative tendering volume for BESS in China reached approximately 170 GWh in the first half of 2025, reflecting a 121% year-over-year increase, surpassing previous growth expectations [2][8] Summary by Sections BESS Demand and Market Trends - The demand for BESS continues to exceed expectations, with June 2025 tendering volume in China reaching 56.7 GWh, a 292% year-over-year increase [2][9] - The report notes a significant time lag of 4-8 months between tendering and installation, alleviating concerns regarding the exit of mandatory ESS installation policies [2] Company Positioning and Financial Projections - Hyperstrong is positioned as a leading BESS supplier in China, holding approximately 12% market share in 2024, with expectations of a decline to 6% by 2030 due to increased competition [13][3] - The report forecasts a 20% EPS growth from 2024 to 2030, supported by a 33% volume growth [3][13] Catalysts for Growth - Key near-term catalysts for Hyperstrong include sizable supply contracts, the launch of differentiated products, vertical integration strategies, and supportive policy reforms for the BESS business model [3][14]