Contemporary Amperex Technology Co. Ltd. (CATL, 300750 CH): Dominating the Global EV Battery Market

Recommendation: BUY

• Target Price: RMB250.00
• Date of Recommendation: September 9, 2024
• Broker Company: UOB Kay Hian

Investment Thesis:

CATL remains the global leader in the EV battery market, with a 38% market share in the first seven months of 2024. The company’s dominance in battery production, combined with its strong growth prospects, supports the buy recommendation.

Key factors driving the investment case include:

• Market Leadership: CATL’s global battery installations reached 163.3 GWh in the first seven months of 2024, reflecting a 29.9% yoy increase. The company continues to lead the global EV battery market with a 37.6% market share.
• Strong Demand for EV Batteries: The continued growth of the EV market, both in China and globally, has driven demand for CATL’s batteries. The company is expected to maintain its market leadership, supported by new contracts and partnerships.

Financial Performance:

• Revenue Growth: CATL’s revenue is projected to grow significantly as demand for EV batteries continues to rise, driven by both domestic and international markets.

Valuation and Catalysts:

The target price of RMB250.00 is based on CATL’s market leadership and the continued growth of the EV industry. As the company expands production capacity and secures new contracts, it is expected to deliver strong returns for investors.

Thank you