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JPMorgan Maintains 'Overweight' on CATL, Says Market Overreacts to Short-Term Share Concerns
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JPMorgan has maintained its 'Overweight' rating on Contemporary Amperex Technology Co. Ltd. (CATL, stock code 03750) with a target price of HK$725, according to a research report cited by Zhitong Finance. The stock has fallen 17% month-to-date, underperforming the Hang Seng Index's 2% decline, amid market concerns over OEM supply diversification, slowing demand, and intensifying competition. JPMorgan argues the market is overly focused on short-term price and market share trends. The bank cites a September 2025 NielsenIQ global survey of new energy vehicle consumers, which found CATL's trust ratings in China and overseas are 81% and 75%, respectively, leading the second-ranked brand by 4 and 8 percentage points. 79% of respondents said a recognized high-quality battery brand increases their purchase intent, 76% are willing to pay a premium, and 37% of Chinese consumers would reconsider purchasing a desired model if it did not use CATL batteries. JPMorgan also notes that energy storage system quality is becoming a driver of revenue and internal rate of return, rather than just cost, and that CATL's equipment price gap with peers is typically less than 5% of total project cost.
Source report
Hong Kong — Morgan Stanley has released a research report maintaining an "Overweight" rating on Contemporary Amperex Technology Co., Ltd. (CATL) (03750), with a target price of HK$725.
CATL's share price has declined by 17% month-to-date, underperforming the Hang Seng Index's 2% drop over the same period. The decline is primarily attributed to market concerns over:
- Diversification of supply among OEM manufacturers
- Slowing demand
- Intensifying competition
Morgan Stanley believes the market is overly focused on short-term trends in pricing and market share.
Consumer Trust and Brand Premium
Citing NielsenIQ's September 2024 Global New Energy Vehicle Consumer Survey, Morgan Stanley highlighted the following key findings:
- CATL's trust rating stands at 81% in China and 75% overseas, leading the second-ranked brand by 4 and 8 percentage points, respectively.
- 79% of respondents indicated that a recognized high-quality battery brand would increase their willingness to purchase.
- 76% of consumers are willing to pay a premium for such brands.
- 37% of Chinese consumers said they would think twice before purchasing a desired vehicle model if it did not use CATL batteries.
Energy Storage Systems as a Value Driver
The report also noted that the quality of energy storage systems is becoming a key driver of revenue and internal rate of return, rather than being purely a cost consideration. According to Morgan Stanley, the price gap between CATL's equipment and that of its peers is generally less than 5% of total project costs.
Source
智通财经Neutral / independent
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CATL shares drop 17% month-to-date; JPMorgan, Citi call it oversold