CORE RECOMMENDATION
现价：
目标价：
上升空间：
前次目标价：
RMB 369
RMB 550
+49.5%
—
分析员
CATL Price Chart
Is bigger always better? When it comes to EV batteries, scale seems to be everything. However, in a cyclical industry, scale alone is not enough to ensure sustainable long-term growth. CATL is not only a volume leader globally, it also excels in vertical integration and technology innovation. This makes its growth more sustainable and margins more resilient – the key rationale for our Core Recommendation. We've made CATL (300750.CH, 3750.HK) a Core Recommendation and added its A-shares to our China Stock Model Portfolio, effective Feb 9 (see Appendix). As a reminder, Core Recommendations are our highest-conviction stock picks, with a minimum one-year investment horizon.
Company Description
Contemporary Amperex Technology Co. Ltd. (CATL) is the world's leading manufacturer of lithium-ion batteries (LIBs), mainly used in electric vehicles (EVs). It is the largest manufacturer of EV batteries globally, with a 39.2% market share and a significant lead over No. 2 BYD (16.4% share). The company supplies to Tesla, Volkswagen, BMW, Stellantis and most Chinese OEMs. Founded in 2011 and based in China, CATL operate factories in China, Germany, Hungary and Spain.
Global EV Battery Market Share (2025)
CATL's Electric Vehicle Solutions
Investment Thesis
We like CATL for the following reasons:
Industry backdrop: continuing strong growth in LIBs globally, driven by robust EV battery demand and surging demand from energy storage systems (ESS). With improving supply-demand dynamics, LIB prices are expected to increase by 5-10% in 2026. These factors combined should benefit CATL as a global LIB leader with both EV and ESS applications. Global EV battery demand is expected to growth 20-25% annually through 2030, driven by accelerating adoption of EVs. Global ESS battery demand is expected to surge 65% in 2026 and maintain a 30% CAGR through 2030. This is mainly driven by explosive growth in electricity demand from AI data centers. CATL's vertical integration strategy and economies of scale. Over the years, CATL has successfully integrated upstream raw materials (e.g. lithium), midstream components (e.g. cathodes and anodes), downstream systems (e.g. batter packs), recycling and localized manufacturing. This vertical integration allows the company to control costs, ensure manufacturing resilience and protect margins through industry cycles. As a result, CATL is able to maintain an average net margin of 11.54% in the last 5 years, versus 1.78% for LG Energy and 7.12% at Samsung SDI. CATL's installed capacity of 631.7 Gwh (EV + ESS) in 2025 and its production target of 1,300 Gwh in 2026 places the company firmly at No. 1 globally, reinforcing its dominance and scale-based moat. Its global footprint also helps mitigate tariff and geopolitical risks. Technological leadership and innovative edge. CATL is not only a volume leader but also a technology pioneer. Past innovations include Cell-to-Pack (CTP), no thermal propagation (for safety), Million-Mile Battery and superfast charging etc. The company's latest breakthrough is on sodium-ion batteries (Naxtra brand), which provide stable power deliver even at extremely low temperature (as low as -50 °C). Technology innovation creates both revenue and margin upside for CATL. For these reasons, we remain confident in CATL's ability to deliver sustainable growth over the long term. We expect its EV battery sales to grow at a 19.5% CAGR in 2025-2027, and its ESS battery sales to grow at a 25.8% CAGR over the same three-year period.
Valuation and Price Target
CATL's A-shares (300750.CH) currently trade at 19.7x forward PE, lower than the 10-year average of 38.0x, suggesting an attractive valuation versus its historical trend. The group's earnings are expected to grow 30.3% in 2025E and 20.3% in 2026E (UOB Kay Hian estimates). CATL is also a top pick by our auto analyst Ken Lee, who has price target of RMB 550 for the A-share (300750.CH), implying an 49.5% upside from the Feb 11 closing price. For more information, please see to Ken's latest report below.
CATL's Global Manufacturing Footprint
Appendix: China Stock Model Portfolio
Is bigger always better? When it comes to EV batteries, scale seems to be everything. However, in a cyclical industry, scale alone is not enough to ensure sustainable long-term growth. CATL is not only a volume leader globally, it also excels in vertical integration and technology innovation. This makes its growth more sustainable and margins more resilient – the key rationale for our Core Recommendation. We've made CATL (300750.CH, 3750.HK) a Core Recommendation and added its A-shares to our China Stock Model Portfolio, effective Feb 9 (see Appendix). As a reminder, Core Recommendations are our highest-conviction stock picks, with a minimum one-year investment horizon.
Company Description
Contemporary Amperex Technology Co. Ltd. (CATL) is the world's leading manufacturer of lithium-ion batteries (LIBs), mainly used in electric vehicles (EVs). It is the largest manufacturer of EV batteries globally, with a 39.2% market share and a significant lead over No. 2 BYD (16.4% share). The company supplies to Tesla, Volkswagen, BMW, Stellantis and most Chinese OEMs. Founded in 2011 and based in China, CATL operate factories in China, Germany, Hungary and Spain.
Global EV Battery Market Share (2025)
CATL's Electric Vehicle Solutions
Investment Thesis
We like CATL for the following reasons:
Industry backdrop: continuing strong growth in LIBs globally, driven by robust EV battery demand and surging demand from energy storage systems (ESS). With improving supply-demand dynamics, LIB prices are expected to increase by 5-10% in 2026. These factors combined should benefit CATL as a global LIB leader with both EV and ESS applications. Global EV battery demand is expected to growth 20-25% annually through 2030, driven by accelerating adoption of EVs. Global ESS battery demand is expected to surge 65% in 2026 and maintain a 30% CAGR through 2030. This is mainly driven by explosive growth in electricity demand from AI data centers. CATL's vertical integration strategy and economies of scale. Over the years, CATL has successfully integrated upstream raw materials (e.g. lithium), midstream components (e.g. cathodes and anodes), downstream systems (e.g. batter packs), recycling and localized manufacturing. This vertical integration allows the company to control costs, ensure manufacturing resilience and protect margins through industry cycles. As a result, CATL is able to maintain an average net margin of 11.54% in the last 5 years, versus 1.78% for LG Energy and 7.12% at Samsung SDI. CATL's installed capacity of 631.7 Gwh (EV + ESS) in 2025 and its production target of 1,300 Gwh in 2026 places the company firmly at No. 1 globally, reinforcing its dominance and scale-based moat. Its global footprint also helps mitigate tariff and geopolitical risks. Technological leadership and innovative edge. CATL is not only a volume leader but also a technology pioneer. Past innovations include Cell-to-Pack (CTP), no thermal propagation (for safety), Million-Mile Battery and superfast charging etc. The company's latest breakthrough is on sodium-ion batteries (Naxtra brand), which provide stable power deliver even at extremely low temperature (as low as -50 °C). Technology innovation creates both revenue and margin upside for CATL. For these reasons, we remain confident in CATL's ability to deliver sustainable growth over the long term. We expect its EV battery sales to grow at a 19.5% CAGR in 2025-2027, and its ESS battery sales to grow at a 25.8% CAGR over the same three-year period.
Valuation and Price Target
CATL's A-shares (300750.CH) currently trade at 19.7x forward PE, lower than the 10-year average of 38.0x, suggesting an attractive valuation versus its historical trend. The group's earnings are expected to grow 30.3% in 2025E and 20.3% in 2026E (UOB Kay Hian estimates). CATL is also a top pick by our auto analyst Ken Lee, who has price target of RMB 550 for the A-share (300750.CH), implying an 49.5% upside from the Feb 11 closing price. For more information, please see to Ken's latest report below.
CATL's Global Manufacturing Footprint
Appendix: China Stock Model Portfolio
CORE RECOMMENDATION
现价：
目标价：
上升空间：
前次目标价：
RMB 369
RMB 550
+49.5%
—
分析员
CATL Price Chart
IMPORTANT NOTICE - DISCLOSURES AND DISCLAIMERS
This report is prepared by UOB Kay Hian (Hong Kong) Limited ("UOBKH HK"). UOBKH HK is a licensed corporation regulated by the Securities and Futures Commission of Hong Kong. This document is for information only and is not an offer or solicitation to buy or sell any security. The information contained herein has been obtained from sources believed to be reliable but UOBKH HK does not make any representation or warranty, express or implied, as to its accuracy, completeness or correctness. Opinions and estimates are subject to change without notice. UOBKH HK and its affiliates may have positions in, and may effect transactions in securities mentioned herein. Past performance is not necessarily indicative of future results. Investors should seek financial advice regarding the appropriateness of investing in any securities or investment strategies discussed or recommended in this report.
