Core Insights - The average price of power battery packs is expected to decline by 3% in 2026, reaching $105 per kWh, although the decrease will be less than in 2025 [1] - The decline in battery prices is driven by an oversupply of battery capacity in China, increasing market competition, and a shift towards lower-cost and safer lithium iron phosphate technology [1][3] - Despite the price drop, the reduction is smaller compared to an 8% year-on-year decline in 2025, where prices fell to $108 per kWh amid rising battery metal prices [1][3] Industry Trends - The continuous decrease in battery prices is facilitating the global adoption of electric vehicles, with China leading this trend [3] - Lower battery prices are also energizing the large-scale application of stationary energy storage systems, which provide stability for intermittent renewable energy sources [3] - BNEF predicts that global energy storage installations will more than double over the next decade, supported by ongoing R&D investments, improved production efficiency, and expanded supply chain networks [3] Technological Advancements - Future battery price reductions will be driven by advancements in technologies such as silicon-based anodes, lithium metal anodes, solid-state electrolytes, new cathode materials, and innovative cell manufacturing processes [3]

Core Insights - The Gradiant Technology Park (GTP) is a 212-acre industrial park in Taylor, Texas, aimed at becoming a cornerstone for the next generation of industry in the region [1] Group 1: Project Overview - The groundbreaking ceremony for GTP took place on November 17, 2025, with notable attendees including Gradiant Group Chairman Kihyung Lee and iMarketAmerica CEO Incheol Kim [3][5] - GTP is designed as a platform for a future ecosystem where industries such as semiconductors, batteries, data centers, and AI converge, promoting collaboration among industry, education, community, and sustainability [8] Group 2: Strategic Partnerships - iMarketAmerica, the developer of GTP, is a key procurement partner for Samsung, attracting existing Samsung suppliers and those seeking to establish business relationships with Samsung [4] - The project aims to leverage iMarketAmerica's global supply chain expertise to support Texas Governor Greg Abbott's vision of "Bigger. Better. Texas" [8] Group 3: Economic Impact - GTP's first phase includes major infrastructure work and two initial facilities, with expectations of attracting dozens of companies and creating thousands of jobs in the coming years [9] - Williamson County Judge Steven Snell highlighted the importance of Gradiant's investment in strengthening ties with Korea, noting that over 300 Korean companies already operate in Texas [10] Group 4: Leadership Vision - Kihyung Lee, with a background in e-commerce, shifted Gradiant's focus from online shopping to global infrastructure and life sciences, positioning GTP as a key pillar in this strategy [6] - Lee emphasized the importance of building a collaborative ecosystem that supports local talent and small to mid-sized enterprises, aiming for sustainable industrial development that can expand across the U.S. and globally [8]

Asia Pacific Equity Research 04 December 2025 This material is neither intended to be distributed to Mainland China investors nor to provide securities investment consultancy services within the territory of Mainland China. This material or any portion hereof may not be reprinted, sold or redistributed without the written consent of J.P. Morgan. China Battery & Materials 2026 target revised up; December production outlook: CATL the only manufacturer seeing m/m growth J.P. Morgan Securities (Asia Pacific) Li ...

Summary of Key Points from the Conference Call Industry Overview - The focus is on the materials sector, specifically aluminum, copper, and the battery chain, with a cautious stance on anti-involution sectors [1][2][3]. Core Insights Aluminum - Aluminum is preferred over copper due to underappreciated supply risks, particularly regarding smelting capacity in Indonesia and potential over-optimism in Middle Eastern expansion plans [2]. - Chinese smelter utilization is reported at over 98%, with China being a net importer of aluminum, primarily from Russia [2]. - Apparent consumption and inventory levels for aluminum in China are healthier compared to copper [2]. - Top picks in aluminum include Hongqiao and Chalco H/A [2]. Copper - Demand for copper is weakening as of Q4 2025, with inventory stockpiling observed in both the US and China [3]. - Price expectations for copper may be influenced by anticipated rate cuts into 2026, with long-term bullish sentiment due to potential supply deficits in the next 3-5 years [3]. - Tight global power supply is contributing to positive sentiment for copper [3]. - Zijin Mining's copper and lithium assets are considered undervalued, with a Buy rating maintained [3]. - Among pure copper plays, MMG is preferred over CMOC for better valuation [3]. Battery Chain - The battery chain is viewed as more defensive, with a rally driven by strong expectations for energy storage systems (ESS) [4]. - Caution is advised before the Chinese New Year, as the rally may be mostly priced in [4]. - Defensive names like CATL are preferred into Q1 2026 due to uncertainties in production pipelines and weak EV demand [4]. - Key catalysts to watch include the production pipeline in March 2026, which could shift market sentiment towards companies with higher elasticity [4]. Cement and Steel - Cement and steel sectors are the least preferred, with steel demand supported by exports but facing weaker anti-involution enforcement [5]. - Production cuts in cement are not expected due to profitability among companies, leading to low prices and profits into H1 2026, with potential recovery in H2 2026 [6]. Additional Important Points - The report emphasizes the importance of monitoring the production pipeline and market conditions closely, particularly for aluminum and copper [2][3][4]. - The overall sector ranking is: Aluminum > Copper > Battery > Gold > Battery Materials > Coal > Cement > Steel [1]. - Cross-sector top picks include Hongqiao, Chalco H/A, Zijin Mining H/A, and CATL-A [1].

Core Insights - QuantumScape is nearing the commercialization of its solid-state EV battery technology, which could significantly impact the electric vehicle market [1] - The company's stock has experienced a substantial increase of approximately 140% in 2025, although it has recently declined over 30% from its highs due to a 33.4% drop in November [2][7] Company Progress - QuantumScape's solid-state battery technology promises safer, faster-charging, and more efficient EV batteries, potentially revitalizing demand for battery electric vehicles [5] - The company demonstrated its battery technology using a Ducati motorcycle in September, marking a significant milestone [5] - QuantumScape has entered into new partnership agreements aimed at high-volume production and commercialization, contributing to a surge in stock prices in September and October [6] Market Context - The growth of EV sales has slowed, partly due to the emergence of hybrid vehicles, which offer consumers a backup engine and alleviate range anxiety [4] - The current market cap of QuantumScape is approximately $8 billion, with a notable liquidity of about $1 billion as of Q3, which is expected to sustain operations through 2029 [7][8] Investment Considerations - Investing in QuantumScape requires patience and a tolerance for risk, as the company is still in the speculative phase despite its promising technology [8] - The stock is considered highly speculative, with a market cap reflecting significant future sales expectations even before actual revenue generation [9]

Core Insights - Enovix's stock has experienced a significant decline since September, bringing its valuation close to the lowest levels seen in years, which may present an opportunity for investors to increase their positions in the company [1] Group 1: Market Dynamics - The equity market is characterized by daily price fluctuations that can lead to substantial wealth creation or destruction over the long term [1] - Pacifica Yield focuses on long-term wealth creation by targeting undervalued high-growth companies, high-dividend stocks, REITs, and green energy firms [1]

Core Insights - The Gradiant Technology Park (GTP) is a 212-acre industrial park aimed at becoming a cornerstone for the next generation of industry in Central Texas [1][7] - The project is backed by iMarketAmerica, which is focused on creating a collaborative ecosystem for industries such as semiconductors, batteries, data centers, and AI [7][8] - The groundbreaking event highlighted the importance of cross-border economic expansion and collaboration between local and Korean companies, particularly Samsung [4][9] Company Overview - iMarketAmerica is a B2B purchasing service provider that aims to achieve mutual growth with its customers through efficient processes and expertise in specialized distribution [11] - The company has been actively involved in the development of GTP, completing land subdivision, permitting, and infrastructure planning on schedule [8] Industry Implications - GTP is designed to support local talent and attract small to mid-sized enterprises, fostering a sustainable industrial development model that could expand across the U.S. and into global markets [7] - The project is expected to create thousands of jobs and attract dozens of companies in its first phase, indicating significant economic growth potential for the region [8]

Summary of Conference Call Notes on China Specialty Chemicals and Lithium Industry Industry Overview - The focus is on the lithium battery supply chain, particularly in the context of the upcoming Chinese New Year (CNY) and the anticipated demand for energy storage systems (ESS) [1] - The sentiment is cautiously optimistic regarding the battery chain rally, suggesting that much of the positive outlook has already been priced in [1] Key Company Insights CATL (Contemporary Amperex Technology Co., Ltd.) - CATL is highlighted as a preferred investment choice for the first quarter of 2026 due to its defensive positioning amid uncertainties in production and electric vehicle (EV) demand [1] - The valuation for CATL-H is set at HK$621 per share, based on a target EV/EBITDA multiple of 17.3x for 2025, which is 0.15 standard deviations above its historical average [19] - The valuation for CATL-A is set at Rmb571 per share, also based on a target EV/EBITDA multiple of 17.3x for 2026 [21] - Risks associated with CATL include lower-than-expected EV demand, increased competition in the EV battery market, and higher raw material costs [20][21] Market Dynamics - Lithium carbonate (Li2CO3) and lithium hydroxide (LiOH) average selling prices (ASP) have increased week-over-week, with Li2CO3 priced at Rmb94,000 per ton and LiOH at Rmb82,500 per ton as of December 4, 2025 [2] - Production of Li2CO3 in China remained stable at 21,939 tons, with variations in output from different sources: brine (-4%), lepidolite (+2%), spodumene (+1%), and recycling (+2%) [2] - Total inventory of Li2CO3 decreased by 2% week-over-week to 113,602 tons, with downstream players' inventory increasing by 4%, while smelters' inventory decreased by 15% [2] Investment Recommendations - The report suggests a focus on battery-related companies with higher elasticity, particularly those involved in lithium, separators, electrolytes, cathodes, and tier-2 battery makers with significant ESS exposure [1] - The anticipated seasonal supply/demand mismatch in the battery value chain is expected to create opportunities in the traditional peak season from March to April [1] Conclusion - The lithium market is experiencing a cautious yet optimistic phase, with CATL positioned as a strong investment choice amid potential risks and uncertainties in the EV sector. The dynamics of lithium pricing and production are critical to monitor as the market approaches the peak demand season.

Core Points - Ensurge Micropower ASA successfully completed a private placement of 111,111,111 new shares, which is divided into Tranche 1 and Tranche 2, and is launching a potential subsequent offering of up to 22,222,222 new shares [1] - The Extraordinary General Meeting held on 3 December 2025 approved Tranche 2 of the Private Placement and the Subsequent Offering [1] - The Norwegian Financial Supervisory Authority has approved the Prospectus for the listing of 93,146,782 of the Private Placement Shares and the Subsequent Offering Shares [3] Private Placement and Subsequent Offering - The listing of 93,146,782 Private Placement Shares and the Subsequent Offering Shares is subject to the approval of a Prospectus by the Norwegian FSA [2] - The subscription period for the Subsequent Offering starts on 5 December 2025 at 09:00 CET and expires on 12 December 2025 at 16:30 CET [4] Company Overview - Ensurge specializes in advanced microbattery technology aimed at powering AI-enabled devices, with a focus on performance and safety [6] - The company is based in San Jose, California, and utilizes high-precision roll-to-roll production processes for its thin-film batteries [6] - Ensurge collaborates with leading global customers to expedite their products to market and is listed on the Oslo Stock Exchange [6]

Summary of Key Points from the Conference Call Industry Overview - The focus is on the materials sector, specifically aluminum, copper, and the battery chain, with a cautious stance on anti-involution sectors [1][2][3]. Core Insights Aluminum - Aluminum is preferred over copper due to underappreciated supply risks, particularly concerning smelting capacity in Indonesia and potential over-optimism regarding Middle Eastern expansion plans [2]. - Chinese smelter utilization is reported at over 98%, with China being a net importer of aluminum, primarily from Russia [2]. - Apparent consumption and inventory levels for aluminum in China are healthier compared to copper [2]. - Top picks in aluminum include Hongqiao and Chalco H/A [2]. Copper - Demand for copper is weakening as of Q4 2025, with inventory stockpiling observed in both the US and China [3]. - Price expectations for copper may be influenced by anticipated rate cuts into 2026, with long-term bullish sentiment due to potential supply deficits in the next 3-5 years [3]. - Tight global power supply is contributing to positive sentiment around copper [3]. - Zijin Mining's copper and lithium assets are considered undervalued, with a recommendation to maintain a Buy rating [3]. - Among pure copper plays, MMG is favored over CMOC for better valuation [3]. Battery Chain - The battery chain is viewed as more defensive, with a rally driven by strong expectations for energy storage systems (ESS) [4]. - Caution is advised before the Chinese New Year, as uncertainties in production pipelines are anticipated due to seasonality and weak EV demand [4]. - Key catalysts to watch include the production pipeline in March 2026, which could shift market sentiment towards companies with higher elasticity in the battery supply chain [4]. - Preferred companies in the battery sector include CATL [4]. Cement and Steel - Cement and steel sectors are the least preferred, with steel demand supported by exports but facing weaker anti-involution enforcement [5]. - Production cuts in these sectors are not expected to be stringent, leading to low cement prices and profits into the first half of 2026, with a potential recovery in the second half [5][6]. Additional Insights - The overall sector ranking is: Aluminum > Copper > Battery > Gold > Battery Materials > Coal > Cement > Steel [1]. - Cross-sector top picks include Hongqiao, Chalco H/A, Zijin Mining H/A, and CATL-A [1]. This summary encapsulates the key points discussed in the conference call, highlighting the investment outlook for various materials and sectors.