January 11, 2026 08:11 PM GMT Contemporary Amperex Technology Co. Ltd. | Asia Pacific VAT Refund Adjustment: Bad or Good? VAT refund changes will have a limited impact on CATL's earnings but will pose challenges for tier 2 battery players. CATL has multiple buffers to mitigate the impact, as in 2025. More importantly, CATL should have stronger pricing power in the overseas ESS market, as small players are squeezed out. Muted impact as similar to 2025. The battery value-added tax (VAT) refund rate will be re ...

December 30, 2025 11:42 PM GMT M Update Contemporary Amperex Technology Co. Ltd. | Asia Pacific ePV Subsidy Continuity Confirmed, Uncertainty Removed Key Takeaways 2026 large-scale equipment renewal and consumer goods trade-in policy for electric passenger vehicles (ePV): Morgan Stanley Asia Limited+ Jack Lu Equity Analyst Jack.Lu@morganstanley.com +852 2848-5044 Contemporary Amperex Technology Co. Ltd. (300750.SZ, 300750 CS) Top Pick China Energy & Chemicals | China Stock Rating Overweight Industry View In ...

Core Insights - Ford Motor Co. and SK On have decided to terminate their EV battery manufacturing partnership due to challenges in the electric vehicle market, including regulatory changes and declining demand [1][2][3] Company Developments - SK On will shift its focus towards Energy Storage Systems and has announced changes in ownership of the battery plants, with Ford taking full ownership of the Kentucky plant and SK On assuming control of the Tennessee plant [2][3] - The partnership, known as BlueOval SK, had involved significant investments, totaling approximately $11.4 billion, primarily for the $5 billion Kentucky plant, which was producing batteries for the F-150 Lightning EV Pickup Truck [4] Market Context - The decision to end the partnership aligns with a broader strategy to reduce debt and enhance profitability, as SK On has reported multi-million dollar losses amid falling EV demand [3] - Ford's EV sales have seen a drastic decline, with a reported 60% drop in November, raising concerns about the viability of ongoing EV projects [4] Regulatory Environment - Recent regulatory changes, including the rollback of Corporate Average Fuel Economy (CAFE) Standards by President Trump, have contributed to the challenges faced by the EV sector [5] - Ford's CEO, Jim Farley, has expressed a commitment to EVs despite these challenges, emphasizing the importance of remaining competitive in the global market [6]

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 ...

December 4, 2025 07:22 AM GMT Ganfeng Lithium Co. Ltd. | Asia Pacific Business Update Call Takeaways Key Takeaways Mgmt expects Ganfeng's lithium chemicals production to be 170-180kt LCE in 2025, growing by 50kt LCE in 2026, of which 30-50kt will come from its own mines. Project updates: Management sees a tight supply-demand balance for lithium in 2026, with demand being ~2mnt LCE and supply being 2-2.1mnt LCE, assuming some restarts following recent lithium price hikes. The s-d balance could be even tighte ...

Summary of the 2025 China Materials Tour Conference Call Industry Overview - **Industry**: Battery Materials and Energy Storage Systems (ESS) - **Key Company**: ZE Consulting Core Insights 1. **Battery Demand Forecast**: ZE Consulting predicts a significant increase in ESS demand for FY26, estimating a growth of **70-80% YoY**. This is attributed to battery makers revising their output guidance upwards for FY26, indicating a tightening supply-demand dynamic in the battery market [1][2][3] 2. **Battery Price Trends**: Anticipated price hikes in batteries are expected due to: - Tightening supply and demand dynamics for both ESS and electric vehicle (EV) batteries - Inflation in raw material costs that battery manufacturers will need to pass on to consumers [1][3][5] 3. **Production Pipeline**: The production pipeline for December 2025 is expected to remain stable month-over-month. Leading battery manufacturers are stockpiling battery materials in preparation for increased average selling prices (ASP) and for production needs during the Chinese New Year [2][3] 4. **Cost Inflation Impact**: Recent inflation in battery materials has resulted in approximately a **10% increase** in the cost of battery cells. Key materials such as LiPF6, VC, and lithium carbonate have seen significant price increases, with further hikes expected for cathodes and other components [3][5] 5. **Lepidolite Mine Operations**: JXW is projected to resume operations in December 2025, adding around **8,000 tons of lithium carbonate equivalent (LCE)** monthly to the market. However, other lepidolite mines may face operational suspensions similar to CATL's situation during FY26 [4][5] 6. **Price Hikes Sequence**: The sequence of price increases is expected to start with ESS, followed by LiPF6 and cathodes, and then separators and anodes. EV battery prices may also rise due to cost pressures and a shift in production capacity towards ESS [5][8] 7. **Profitability Concerns**: If battery makers increase the ASP of battery cells to offset cost inflation, it could negatively impact the internal rate of return (IRR) for ESS projects. Profitability is at risk if the ASP exceeds **Rmb0.4/wh** [8] Additional Important Points - **Inventory Management**: Leading battery manufacturers are increasing their inventory of battery materials in anticipation of rising prices and production needs [2][3] - **Market Dynamics**: The overall market dynamics indicate a shift towards a more constrained supply environment, which could lead to further price volatility in the battery materials sector [1][5] This summary encapsulates the key insights and projections discussed during the conference call, highlighting the evolving landscape of the battery materials industry and its implications for future investments.

Core Insights - Huang Shilin, co-founder and third-largest shareholder of Contemporary Amperex Technology (CATL), sold a 1% stake for 1.7 billion yuan (US$239 million) amid a rally in CATL's shares [1][2] - The sale involved 45.6 million yuan-denominated A shares at a price of 376.12 yuan (US$52.92) each, representing a 0.9% discount to CATL's closing price of 379.39 yuan [2][3] - CATL's mainland-traded shares have increased by 46% this year, driven by technological advancements and overseas expansion [3][5] Company Performance - CATL raised US$5.22 billion in May through the largest initial public offering of the year, with its H shares rising 84% from the offer price, closing at HK$483 [4] - The company is recognized as a leading player in the electric vehicle battery market, powering over one-third of electric cars globally [5] Leadership Changes - Huang Shilin has stepped down from his role at CATL and is no longer an employee of the company [6]

Investment Rating - The report assigns a "Buy" rating for CALB Group Co Ltd with a target price of HK$33.40, indicating an expected share price return of 3.3% [6]. Core Insights - CALB's battery shipment volume guidance for 2025E is set at 110GWh, with expectations to exceed this target based on year-to-date trends and production plans for the last two months of the year. For 2026E, the guidance is 180GWh, comprising 110GWh for EV batteries and 70GWh for ESS batteries [2][3]. - The completed battery capacity is projected to be over 160GWh by the end of 2025 and over 230GWh by the end of 2026, with effective capacities expected to be 130GWh and nearly 200GWh, respectively [2]. - Demand for ESS batteries is strong, with CALB operating at full capacity in 2025. The company anticipates sustained capacity amid shipment bottlenecks and strong demand growth from both existing and new clients in 2026-27E [3]. - Management expects a slight increase in the average selling price (ASP) of ESS batteries due to tight supply, but significant increases are unlikely. Margins in the ESS battery segment are expected to rise in 2026-27E due to increased shipments to overseas markets and higher-margin ESS system shipments [4]. - For EV batteries, effective capacity is expected to reach 85GWh in 2025E and 130GWh in 2026E. Shipment growth for EV batteries is anticipated to remain strong, with improved margins expected as shipments to international OEMs increase [5]. Summary by Sections Battery Shipment - CALB's battery shipment volume guidance for 2025E is 110GWh, with expectations to exceed this target. For 2026E, the guidance is 180GWh, including 110GWh for EV batteries and 70GWh for ESS batteries [2]. Battery Capacity - Completed battery capacity is expected to be over 160GWh in 2025 and over 230GWh in 2026, with effective capacities projected at 130GWh and nearly 200GWh, respectively [2]. ESS Battery - ESS battery demand is strong, with full utilization expected in 2025. Capacity is anticipated to be sustained in 2026 amid strong demand growth [3]. ESS Battery Price and Margin - Management expects a slight increase in ESS battery ASP due to tight supply, with margins expected to rise in 2026-27E due to increased shipments to overseas markets [4]. EV Battery - Effective capacity for EV batteries is projected at 85GWh in 2025E and 130GWh in 2026E, with strong shipment growth and improved margins expected [5].

Summary of CATL Conference Call Company Overview - **Company**: Contemporary Amperex Technology Co. Limited (CATL) - **Sector**: Auto Parts - **Description**: CATL is China's largest lithium battery manufacturer, focusing on R&D, manufacturing, and sales of EV batteries and energy storage systems (ESS) [11][12] Key Industry Insights - **China EV Battery Market**: - Total installed capacity in September 2025 was 84.3 GWh, up 46% YoY and 18% MoM [3] - CATL's market share in China was 42.2% in September, maintaining its position as the leading supplier [14] - Major clients included Tesla (12%), Geely (11%), and Changan (10%) [1] - **Global Market Position**: - CATL held a global market share of 35% in September 2025, ranking No.1 globally [2] - In Europe, CATL's market share was 41% in September, with major clients including Volkswagen, Audi, and BMW [2][22] Financial Performance - **Revenue and Profit Estimates**: - Projected net income for 2025 is CNY 70,002 million, with an EPS of 15.34 [4][10] - Free cash flow per share is expected to increase to CNY 16.79 by 2025 [4] - P/E ratio is projected to decrease from 50.23x in 2023 to 33.15x in 2025, indicating improving valuation [4] Production and Capacity - **Production Plans**: - Planned production for November 2025 is estimated at 74.5 GWh, representing a 38% YoY increase and a 1% MoM increase [1][15] - The production capacity is aligned with the strong demand for EV and ESS batteries [1] Strategic Partnerships - **Recent Agreements**: - CATL signed a strategic MoU with A.P. Moller - Maersk to enhance global logistics and promote decarbonization [16] - Collaborated with Dongfeng Commercial Vehicle on electrification and technology development [16] - Established a direct-sales channel with JD for battery swap systems [16] Market Trends - **Battery Chemistry and Types**: - In September, the battery chemistry breakdown was 19% NCM and 81% LFP, with prismatic batteries comprising 97.1% of the total [3] - **EV Sales Growth**: - The growth in installed battery capacity aligns with the increasing sales of electric vehicles in China [3] Investment Rationale - **Buy Rating**: - CATL is rated as a "Buy" due to its leading battery technology, cost-saving potential, and strong demand from the ESS sector [12] Additional Insights - **Market Dynamics**: - CATL's domestic market share is expected to increase QoQ in Q4 2025, driven by higher shipments from clients like Xiaomi, NIO, and Li Auto [1] - **Financial Health**: - The company maintains a strong balance sheet with a projected net debt to equity ratio of -65.7% by the end of 2024 [10][4] This summary encapsulates the key points from the CATL conference call, highlighting the company's market position, financial outlook, production plans, strategic partnerships, and investment rationale.

Summary of China Battery Market Conference Call Industry Overview - The report focuses on the **China battery market**, particularly the export data and price expectations for batteries as of August 2025 [5][66]. Key Points and Arguments Battery Export Data - **Total battery exports** (including consumer batteries and Battery Energy Storage Systems (BESS)) increased by **45% year-over-year (YoY)** in August 2025 and **67% YoY** in the first eight months of 2025 [5][75]. - **Export breakdown**: - **United States**: 21% of total export volume in 8M25, with a **28% YoY** increase, but a **60% month-over-month (MoM)** decline back to May levels [5]. - **Europe**: 36% of total export volume in 8M25, with a **65% YoY** increase and a **24% MoM** increase in August 2025. The growth is attributed to both Electric Vehicle (EV) battery demand and emerging demand for Energy Storage Systems (ESS) [5]. - **Rest of the World (RoW)**: 42% of total export volume in 8M25, with a **99% YoY** increase, contributing approximately **107 GWh** of exports [5]. Price Expectations - There is **caution regarding sustained price increases** in the battery market despite short-term tightness. Seasonal strengths in Q4 2025 may lead to temporary price rebounds, but a sustainable price hike is deemed unlikely due to expected seasonal weakness in Q1 2026 [5]. - A **sensitivity analysis** indicates that a **10% price hike** could result in a **30%-60% earnings upside** in 2026E. Companies like **Gotion, CALB, and EVE Energy** are noted to be more sensitive to battery price hikes [5]. Market Dynamics - The **30%-80% rally** in share prices over the past 60 trading days is believed to have already priced in **2%-5% battery Average Selling Price (ASP)** hikes for 2026E [5]. - The **battery supply chain** shows varied utilization trends across different components, with notable increases in separator and electrolyte prices [8][37]. Company Performance - **CATL, BYD, and CALB** are highlighted as key players in the domestic battery installation market, with varying month-over-month growth rates [54][56]. - **Sales volume** for major companies in August 2025 shows significant YoY growth, with **BTR** at **44.1 kt** (+62% YoY) and **Shanshan** at **46.2 kt** (+40% YoY) [60]. Additional Insights - The **European BEV market** saw a **25% YoY sales growth** in the first half of 2025, which is a significant driver for battery imports from China [5]. - Emerging markets with high solar installation percentages, such as the **Netherlands, Bulgaria, and Greece**, are increasingly importing batteries despite limited EV production [5]. Conclusion - The China battery market is experiencing robust growth in exports, particularly to Europe and the RoW, driven by both EV and ESS demand. However, expectations for sustained price increases are tempered by anticipated seasonal fluctuations and a balanced supply-demand dynamic. Key players are positioned to benefit from potential price hikes, but market conditions will require careful monitoring.