Asia Pacific Equity Research 17 November 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. ESS Battery AIDC ESS expert call takeaways rebecca.y.wen@jpmorgan.com J.P. Morgan Securities (Asia Pacific) Limited/ J.P. Morgan Broking (Hong Kong) Limited Alan Ho ...

Core Insights - Greenvolt Power has signed an agreement to sell two battery energy storage system projects in Poland, totaling 300 MW/1.2 GWh, to Northland Power Inc. [1][2] - The projects, Mieczyslawów (200 MW/800 MWh) and Kamionka (100 MW/400 MWh), are designed for a four-hour storage duration and will begin construction in 2026 [2][5] - This transaction aligns with Greenvolt's asset rotation strategy, which involves selling 70-80% of developed assets while retaining 20-30% [3][4] Company Strategies - Greenvolt's asset rotation strategy aims for efficient capital allocation and supports the deployment of renewable energy projects across various regions [3][4] - Northland Power's acquisition enhances its presence in Poland and aligns with its commitment to a low-carbon energy system [4][5] Market Context - Poland's energy system is transitioning from coal-based generation to renewables, with significant growth expected in solar and wind capacity by 2050 [5] - The need for large-scale storage solutions is increasing to balance the grid and ensure reliability as the energy landscape evolves [5][6]

Core Insights - Fluence Energy, Inc. (FLNC) is expected to report quarterly earnings of $0.13 per share, reflecting a decline of 61.8% year-over-year, while revenues are forecasted to reach $1.39 billion, indicating a 13% increase compared to the previous year [1] Earnings Estimates - The consensus EPS estimate has been revised upward by 3% in the last 30 days, indicating a reassessment by covering analysts [2] - Changes in earnings estimates are crucial for predicting investor reactions, as empirical research shows a strong correlation between earnings estimate revisions and short-term stock performance [3] Revenue Projections - Analysts predict that revenue from energy storage products and solutions will reach $1.37 billion, representing a year-over-year increase of 13.9% [5] - The estimated revenue from services is projected at $22.42 million, suggesting a slight decline of 0.5% year-over-year [5] Key Metrics - Energy Storage Products and Solutions - Deployed is estimated to be 7,796 megawatts, up from 5,000 megawatts a year ago [6] - Digital Contracts - Asset under Management is projected to reach 27,800 megawatts, compared to 18,300 megawatts in the previous year [6] - Service Contracts - Asset under Management is estimated at 6,622 megawatts, an increase from 4,300 megawatts reported in the same quarter last year [7] Stock Performance - Over the past month, shares of Fluence Energy have returned +10.5%, while the Zacks S&P 500 composite has seen a change of -0.3% [7] - Currently, FLNC holds a Zacks Rank 3 (Hold), suggesting its performance may align with the overall market in the near future [7]

Core Viewpoint - Eos Energy Enterprises, Inc. has announced a registered direct offering of common stock and a concurrent private offering of convertible senior notes, aiming to raise approximately $458.2 million for repurchasing existing convertible notes and for general corporate purposes [1][2][3]. Group 1: Offering Details - The registered direct offering consists of 35,855,647 shares priced at $12.78 per share, expected to close on November 24, 2025 [1]. - The concurrent private offering includes $525 million of 1.75% convertible senior notes due 2031, with an option for an additional $75 million [3]. - The completion of the registered offering is contingent upon the successful closing of the concurrent notes offering [5]. Group 2: Use of Proceeds - Proceeds from the offerings will be used to repurchase a portion of the existing 6.75% convertible senior notes due 2030, with a total repurchase price of approximately $564.6 million [2][4]. - The repurchase will include accrued and unpaid interest and is subject to various market conditions [4]. Group 3: Company Overview - Eos Energy is focused on advancing American energy independence through innovative energy storage solutions, specifically its BESS featuring Znyth™ technology, which is a safe and scalable alternative to lithium-ion technology [8]. - The company's energy storage systems are designed for utility-scale, microgrid, commercial, and industrial applications, providing long-duration energy storage capabilities [8].

Core Viewpoint - Eos Energy Enterprises, Inc. has announced the pricing of a $525 million offering of 1.75% convertible senior notes due 2031, increasing from a previously announced size of $500 million, with settlement scheduled for November 24, 2025 [1][5] Group 1: Offering Details - The notes will be senior, unsecured obligations with an interest rate of 1.75% per annum, payable semi-annually starting June 1, 2026, and maturing on December 1, 2031 [2] - Noteholders can convert their notes under certain conditions before September 3, 2031, and at any time thereafter until two trading days before maturity, with an initial conversion rate of 61.3704 shares per $1,000 principal amount, equating to a conversion price of approximately $16.29 per share, representing a 27.5% premium over the last reported sale price [2][3] - The notes are redeemable at Eos's option starting December 5, 2028, under specific conditions related to the stock price exceeding 130% of the conversion price [3] Group 2: Use of Proceeds - Eos estimates net proceeds from the offering to be approximately $507.9 million, or $580.5 million if the option for additional notes is fully exercised, intended for repurchasing existing convertible notes and general corporate purposes [5][7] - Concurrently, Eos is offering 35,855,647 shares of common stock at $12.78 per share in a registered direct offering [6] Group 3: Repurchase of Existing Notes - Eos has entered into transactions to repurchase $200 million of its existing 6.75% convertible senior notes due 2030 for approximately $564.6 million, including accrued interest, with terms dependent on various market factors [7] - Certain holders of the existing notes may engage in market activities that could affect the trading price of Eos's common stock and the notes [8] Group 4: Company Overview - Eos Energy Enterprises focuses on energy storage solutions, utilizing its innovative Znyth™ technology, which is a safe and scalable alternative to conventional lithium-ion technology, suitable for various energy storage applications [11]

Core Viewpoint - Albemarle Corporation (ALB) has experienced a significant increase in stock price, marking nine consecutive sessions of gains, with a notable rise of 2.8% to $124.76 on Wednesday [1] Stock Performance - The stock has increased by 25% over the preceding eight sessions [1] - Year-to-date, the stock has surged by 45.5%, outperforming the broader market which saw a 12.5% rise [1]

Core Viewpoint - The global commercial and industrial energy storage shipments are projected to reach 40 GWh in the first nine months of 2025, representing a year-on-year growth of 110% [1]. Group 1: Market Overview - The top 10 companies in the global commercial and industrial energy storage market include: Ruipu Lanjun, CATL, EVE Energy, Haicheng Energy, Fudi Battery, Penghui Energy, Guoxuan High-Tech, Chuangneng New Energy, Zhongchu Innovation, and Ganfeng Lithium [1].

EDISON, N.J., Nov. 18, 2025 (GLOBE NEWSWIRE) -- Eos Energy Enterprises, Inc. (NASDAQ: EOSE) (“Eos” or the “Company”) today announced that it has commenced a registered direct offering of common stock (the “Offering”) to a limited number of purchasers. The Offering is being made pursuant to the Securities Act of 1933, as amended (the “Securities Act”). The Offering is subject to market and other conditions, and there can be no assurance as to whether or when the Offering may be completed, if at all, or as to ...

Core Viewpoint - KULR Technology Group reported significant revenue growth in Q3 2025, driven by product sales and strategic partnerships, while also facing increased operating losses due to higher expenses in R&D and SG&A [2][6][7]. Financial Performance - Revenue for Q3 2025 increased by 116% to $6.88 million, compared to $3.18 million in Q3 2024 [2]. - Product sales rose by 112%, reaching approximately $1.62 million, up from approximately $765,000 in the same quarter last year [2]. - Cash and current accounts receivable totaled $24.54 million as of September 30, 2025 [3]. - Gross margin decreased to 9% in Q3 2025 from 71% in the same period last year, attributed to increased service contract hours and costs related to digital asset mining leases [3]. - SG&A expenses rose to $6.26 million in Q3 2025 from $2.74 million in Q3 2024, driven by growth-related investments [4]. - R&D expenses increased to $2.32 million in Q3 2025 from $1.23 million in the same period last year, reflecting planned increases in R&D services and new hires [5]. - Operating loss for Q3 2025 was $8.74 million, compared to $1.71 million in Q3 2024, primarily due to higher SG&A and R&D expenses [6]. - Net loss for Q3 2025 was $6.97 million, or a loss of $0.17 per share, compared to a net loss of $2.00 million, or a loss of $0.08 per share in the same period last year [7]. Strategic Developments - KULR announced partnerships with Amprius and Molicel to launch the KULR ONE Air product line for unmanned aircraft systems, with initial sample shipments starting in July 2025 and volume production expected in Q4 2025 [8]. - The company introduced six new commercial off-the-shelf K1S CubeSat batteries, enhancing its portfolio in space power systems [11]. - KULR launched a next-generation Battery Management System (kBMS) aimed at setting new industry standards for reliability and safety, with versions tailored for both defense and space applications [11]. - A hosting partnership with Soluna Holdings was established to operate approximately 3.3 MW of Bitcoin mining capacity, marking a strategic move into green data centers [11].

Summary of the Conference Call on China Energy Storage Industry Industry Overview - **Industry**: China Energy Storage Industry, specifically focusing on Battery Energy Storage Systems (BESS) [2][5] Key Points and Arguments 1. **Policy Support for BESS**: - On November 10, 2025, China’s NDRC and NEA issued guidelines to enhance the consumption and dispatch of renewable energy, targeting a significant increase in renewable power generation by 2030 and 2035 [2][3] - By 2030, the annual power demand addition will be primarily met by renewable energy, with a goal of ensuring consumption capability for 200GW of renewable capacity addition per year [2] 2. **Capacity Compensation Mechanism**: - The policy aims to improve the capacity compensation mechanism for BESS, which is expected to diversify revenue streams and enhance returns for BESS projects [3] - Inner Mongolia updated its provincial capacity compensation to Rmb0.28/kWh for BESS commissioned in 2026, a 20% decrease from Rmb0.35/kWh in 2025, valid for 10 years [3] 3. **BESS Price Trends**: - The price of BESS systems in China increased by 4% and 2% week-over-week to Rmb0.50/Wh for 2-hour systems and Rmb0.46/Wh for 4-hour systems as of November 3, 2025 [4] - Despite a 12% month-over-month decline in bidding volume in October, strong domestic demand for BESS is anticipated in Q4 2025, typically a peak season for renewable project interconnections [4] 4. **Valuation and Market Outlook**: - The report maintains a positive outlook on both China and global BESS demand, expecting manufacturers' margins to recover due to improved project IRR for downstream customers [5] - Companies like Sungrow and CSI Solar are expected to benefit from robust global BESS demand and an increasing order pipeline [5] Risks and Considerations 1. **Downside Risks**: - Major risks to the energy storage industry include slower-than-expected growth in domestic renewable energy capacity, smaller-than-expected peak-trough electricity price spreads, and potential import restrictions on China-made products [7] Additional Insights - The report emphasizes the potential for increased market participation in renewable+BESS projects, which could lead to higher utilization rates and improved pricing dynamics for BESS [2][3] - The anticipated strong demand from international markets, including the US and Europe, is expected to sustain the growth of the BESS sector in China [4]