汇丰-中国电动汽车储能电池：需求、竞争与宁德时代五大常见问题-China EVESS battery Five FA Qs on demand,competition and CATL-20261013

13October2026

Equities

Automobiles

ChinaEV/ESSbattery

FiveFAQsondemand,competitionandCATL

China

uSlowingbatterygrowthnotthebiggestconcern–ESSdemandvisibilityisthekeyswingfactor

uThedivergencebetweenstrongESSsalesandslower

installationsraisesquestionsaboutdemandsustainability

uCATL(Buy)isourpreferredname:valuationiscompelling,butasustainedre-ratingneedsgreaterconviction

1.Isbatterydemandlosingmomentum?Notuniformly.EVbatterygrowthis

moderatingfromahighbase,butremainssupportedbyglobalelectrificationand

higherbatterycontentpervehicle.ESSisthebiggeruncertainty.China’sESSbatterysalesgrew84%y-o-yin8M26,ledby98%growthindomesticsales.Yetdomestic

ESSinstallationsroseonly29%.Somelagbetweenbatterydeliveriesandproject

commissioningisnormal,butthedivergenceraisesquestionsaboutthetimingandsustainabilityofunderlyingdemand.Tenderactivityremainsanimportantleading

indicator,althoughexecutionandcommissioningwillbetheultimatetests.

ExpectationsforslowerESSgrowthin2027arereasonable;suggestionsofoutrightmarketcontractionlookpremature.

2.AreESScapacityrestrictionstighteningsupply?Yes,gradually.Tighteningofcapacityapprovalscouldimproveindustryutilisationandpricingdisciplineovertime.Themeasuresfocusonunfilledcapacityadditionsratherthanexistingfacilitiesor

ESSdeployment.GivenCATL’sscale,highutilisationrateandcommittedcapacitypipelines,weseelimitednear-termoperationalimpact,withpotentialmedium-termbenefitsfromamoredisciplinedsupplyenvironment.

3.Competition–isCATLlosingitscompetitiveedge?Notyet.CATL’smarketshareremainsresilientdespitesecond-sourcingeffortsbyOEMs.Weseeselectivesharelossesandmarginnormalisationastemporaryrisksratherthanabroad

erosionofCATL’smoat.

4.Willbatterytaxpolicychangesputpressureonpricing?Weakerdemandisthebiggerrisktopricingpower.TheexportVATrebatephase-outandconsumptiontaxadjustmentareknownfactors;theincrementalriskisthatsofterdownstream

demandweakensbatterymakers’abilitytopassoncosts.Lithiumcarbonatepriceshaveretreated,potentiallycushioningtheimpact.Ourfocusisoncontractpass-

through,grossmargins,andprofitperGWhratherthanheadlineASP.

5.HasCATL’scorrectiongonetoofar?Ataround13x2027ePE,themarketis

pricinginatougherbatterycycle,butwethinkCATL’scompetitiveadvantage

remainslargelyintact.Thisunderpinsourpreferenceforthestock.However,alow

multiplealonemightbeinsufficienttodriveasustainedre-rating.Weseethreetests:earningsdeliveryagainstexpectations,resilienceinuniteconomicsamidpricing

pressure,andimprovingvisibilityonoverseasEVanddomesticESSdemand.Wethinkfundamentalsremainmoreresilientthansentimentsuggests,butevidenceofsustainablegrowthandreturnsisneededtounlockfurtherupside.

YuqianDing*

HeadofChinaTechnology&AutosResearch

TheHongkongandShanghaiBankingCorporationLimitedyuqian.ding@.hk

+85222885108

ElaineChen*(Reg.No.S1700524030001)

Analyst,ChinaAutos

HSBCQianhaiSecuritiesLimitedelaine.chen@

+8601057952364

*Employedbyanon-USaffiliateofHSBCSecurities(USA)Inc,andisnotregistered/qualifiedpursuanttoFINRAregulations

Lessbull,morebite

The25theditionoftheEMSentimentSurvey

Clicktoview

Disclosures&Disclaimer

ThisreportmustbereadwiththedisclosuresandtheanalystcertificationsintheDisclosureappendix,andwiththeDisclaimer,whichformspartofit.

Issuerofreport:TheHongkongandShanghaiBankingCorporationLimited

ViewHSBCGlobalInvestmentResearchat:

2

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13October2026

Q1.Isbatterydemandlosingmomentum,andwhereisthekeyuncertainty?

Chinaremainstheglobalbatterydemandbarometer,butthedebateisshiftingfromEVgrowthdecelerationtoESSdemandvisibility.

Chinabatterymakerssuppliedover70%ofglobalEVbatterydemandandmorethan80%ofglobalESSbatterydemandin2025,makingChinabatterysales–includingexports–akey

indicatorofglobalbatterydemand.ESSisalsobecomingincreasinglyimportantintheindustry

mix–itaccountsfor32%ofChina’sbatterysalesin8M26,upfrom26%in2025.

EVbatterygrowthisslowing,butremainssolid.WithmonthlyEVpenetrationinChina

alreadyabove65%,investorsincreasinglyrecognisethatglobalEVbatterygrowthis

moderatingfromahighbase.Weakdomesticvehicledemandaddstothepressure,with

China’sEVretailsalesdeclining12%y-o-yin8M26.Nevertheless,China’sEVbatterysalesstillgrew39%y-o-yoverthesameperiod,supportedbycontinuedelectrificationofcommercial

vehiclesandrisingbatterycapacitypervehicle(seeChinaEV/ESSbattery:Fundamentalshold;2Qearningsarethekey,6July2026).WebelievethedecelerationinEVbatterygrowthis

largelyunderstoodbythemarket,makingitalessincrementalsourceofdownsidesurprise.

Exhibit1.ChinaEVbatterysalesvolumes(incl.exports)booked+39%y-o-yin8M26

160.0

140.0

120.0

100.0

80.0

60.0

40.0

20.0

-

JanFebMarAprMayJunJulAugSepOctNovDec

2025EVbatterysales(GWh)

2026EVbatterysales(GWh)

y-o-y(%,RHS)

70%

60%

50%

40%

30%

20%

10%

0%

Source:CABIA,HSBC

Exhibit2.DomesticEVPCretailsdeclined12%y-o-yin8M26,withAugmonthlyEV

penetrationat65%

1,500,000

1,000,000

500,000

-

65%65%

61%63%63%

52%

45%

39%

JanFebMarAprMayJunJulAugSepOctNovDec2026EV(PV)retailvolume

2025EV(PV)retailvolume

2026monthlypenetrationrate(RHS)

2025monthlypenetrationrate(RHS)

80%

70%

60%

50%

40%

30%

20%

Source:CPCA,HSBC

ESSisthekeyswingfactor,withsalesgrowthstrong,butdemandconversionunder

scrutiny.China’sESSbatterysales,includingexports,rose84%y-o-yin8M26,accordingtoCABIA,withexportsup42%anddomesticsales98%.However,domesticESSinstallationsin8M26wereequivalenttoonly21%ofdomesticbatterysales,basedonCABIAandCNESA

data,downfrom59%in2025.Thiswideninggaphasbecomeamajorsourceofinvestorconcernoverunderlyingdemandqualityandtheriskofinventoryaccumulation.

Thesales-installationgappartlyreflectsprojecttiming,butexecutionriskshouldnotbedismissed.Batteryrevenueisgenerallyrecognisedwhenprojectsaregrid-connected.The

periodfromshipmenttogridconnectioncanrangefromsixmonthstotwoyears,andlongerforoverseasprojects.Recenttenderwinsmaythereforetaketimetotranslateintoinstallations.

Somedomesticprojectshavealsobeenpushedinto2027asdetailsaboutprovincialimplementationunderthenationalstoragepolicyframeworkcontinuetorollout.

However,timingdifferencesalonemaynotexplaintheentiregap.Thepaceofpolicy

implementation,projectexecutionandtheriskofdelaysorcancellationsinlonger-cycleprojectsremainkeyuncertainties.Untilthesebecomeclearer,concernsoverdomesticESS

absorptionarelikelytoremainarecurringsectoroverhang.

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3

Tenderactivityprovidesamoreforward-lookingread-through,albeitwithsignsof

moderation.WebelievemonthlytenderactivityismoreusefulforassessingforwarddomesticESSdemandthanthesales-installationgapalone.DomesticESStendersgrew86%y-o-yin8M26,althoughgrowthslowedto15%y-o-yinSeptember(CNESAdata).Adecelerationin

domesticESSgrowthin2027isalreadywidelyanticipatedbymarket;weneverthelessviewexpectationsofanoutrightmarketcontractionasoverlypessimisticatthisstage,

pendingfurtherevidence.

LowerlithiumpricescouldalsoimproveESSprojecteconomicsandunlockadditionalapplications.Thekeyquestionis,therefore,notwhetherESSgrowthwillslow,butwhethertenderactivitycantranslateintoactualprojectexecutionandsustainedbatterydemand.

Whattowatch:MonthlyESStendergrowth,domesticinstallations,projectdelaysand

cancellations,andthetimingofpolicyimplementation.Asustainedimprovementininstallationconversionwouldbeamoremeaningfulcatalystthanstrongbatterysalesalone.

Exhibit3.ChinaESSbatterysalesvolumes(incl.exports)booked+84%y-o-yin8M26

90.0

80.0

70.0

60.0

50.0

40.0

30.0

20.0

10.0

-

JanFebMarAprMayJunJulAugSepOctNovDec

2025ESSbatterysales(GWh)

2026ESSbatterysales(GWh)y-o-y(%,RHS)

180%

160%

140%

120%

100%

80%

60%

40%

20%

0%

Source:CABIA,HSBC

Exhibit5.DomesticESSsystemtenderbooked15%y-o-yinSept2026

60.0050.0040.0030.0020.00

10.00

-

705%

283%

246%

116%

75%

37%15%

-30%

-12%

JanFebMarAprMayJunJulAugSepOctNovDec

2025domesticESSsystemTender(GWh)

2026domesticESSsystemTender(GWh)y-o-y(%.RHS)

800%

700%

600%

500%

400%

300%

200%

100%

0%

-100%

Source:CNESA,HSBC

Exhibit4.DomesticESSinstallationrose29%y-o-yin8M26

120.0

100.0

80.0

60.0

40.0

20.0

-

JanFebMarAprMayJunJulAugSepOctNovDec

2025domesticESSinstallations(GWh)

2026domesticESSinstallations(GWh)y-o-y(%,RHS)

150%

100%

50%

0%

-50%

-100%

Source:CNESA,HSBC

Exhibit6.DomesticESSinstallationsin8M26wereequivalenttoonly21%of

domesticbatterysales

400

350

300

250

200

150

100

50

-

59%

33%

21%

20258M258M26

70%

60%

50%

40%

30%

20%

10%

0%

DomesticESSinstalltion(GWh)DomesticESSsales(GWh)Installationas%ofsales(RHS)

Source:CABIA,CNESA,HSBC

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13October2026

4

Q2.AreChina’sESScapacityrestrictionstighteningsupply,andwhatwouldthismeanforCATL?

CapacitydisciplineistighteninggraduallyratherthanthroughablanketbanonESSexpansion.

Thepolicydirectionisnotnew.Itcanbetracedbacktolate2025,whenMIITconvenedindustrymeetingsandcalledforactionagainstirrationalcompetitioninthebatterysector,including

concernsoverpotentialovercapacity.Frommid-2026through3Q26,industryfeedback

suggeststhatthefocushasshiftedtowardsmoreconcretechecksonESScapacityutilisationandtighterscrutinyoffilingsforincrementalcapacity.

Themeasuresappearaimedprimarilyatcurbingnew,unfilledcapacity,notrestricting

ESSdeployment.Existingfacilitiesandprojectsalreadyapprovedorunderconstruction

appearlessdirectlyaffected,althoughimplementationmayvarybyproject.Thepolicyintentistopreventfurtherovercapacityandprice-drivenexpansion,ratherthanslowthedevelopmentofenergystorageitself.

ForCATL,thenear-termcapacityimpactlookslimited,withpotentialupsidetoindustryeconomics.GivenCATL’sexistingcapacitybase,committedexpansionpipeline,andhigh

utilisation,weseelittleevidenceofanimmediatecapacityconstraint.Iftighterscrutinycurbsmarginalsupplyadditions,itcouldgraduallyimproveindustryutilisationandpricingdiscipline,particularlyinlower-endsegmentswherecompetitionhasbeenmostaggressive.

Exhibit7.CATL’scapacityutilisationratehasremainedatahighlevel

100%

90%

80%

70%

60%

50%

40%

30%

20%

10%

0%

95%

97%

90%

76%

70%

61%

65%

1H2320231H2420241H2520251H26

CATL

capacityutilizationrate

Source:Companydata,HSBC

Q3.AredomesticcompetitionandoverseaspolicyrisksunderminingCATL’scompetitiveposition?

De-CATLisationremainsmoreabargainingstrategythanaprovenstructuralshift.

Despiterecurringconcernsovercustomerdiversification,CATL’sdomesticEVbatterymarketshareroseto44.6%in8M26from43%in2025.ItsoverseasEVbatterysharestoodat34%in7M26,versus30%in2025.Currentmarket-sharedatadonotyetpointtostructuralerosionofCATL’scompetitiveposition.

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5

Exhibit8.CATL’s8M26domesticEVbatteryMSwas45%vs43%in2025

51%

49%

47%

45%

43%

41%

39%

37%

35%

JanFebMarAprMayJunJulAugSepOctNovDec

20252026

Source:CABIA,HSBC

China:Secondsourcingisreal,butlastingdisplacementisunproven

WeseeselectivesharelossesandmarginnormalisationasmoretemporaryrisksthanabroaderosionofCATL’smoat.Whendemandvisibilityweakens,OEMsnaturallyintensify

cost-cuttingeffortsandexplorealternativesupplierstostrengthenbargainingpower.Thisismostevidentinmature,price-sensitivemodels,wheresecond-andthird-tiersupplierscancompetemoreaggressively.

TherisktoCATL’sdomesticshareandpricingisgenuine,butsecond-sourcingdoesnot

automaticallytranslateintoalastingshiftawayfromCATL.Winningaprogrammeisonething;deliveringatscalewithconsistentquality,highmanufacturingyieldsandcompetitivetechnologyisanother.

CATL’sscale,execution,technologyandbreadthofcustomerrelationshipsremainmeaningfuladvantages,particularlyinhigher-endplatformsandtechnicallydemandingprogrammes.A

morebearishconclusionwouldrequireevidencethatcompetitorscanconsistentlywinhigh-valueprogrammeswhilematchingCATL’squality,deliveryandcosteconomics.

Europe:Limiteddirecttraderisk;LFPremainsastructuraladvantage

PotentialEUrestrictionsonChinese-madePHEVsposelimiteddirectrisktoCATL.Morethan60%ofCATL-equippedvehiclescurrentlysoldinEuropearelocallyproduced(Rho-motiondata),whileimportedPHEVsaccountforlessthan10%.Evenifrestrictionsweretightened,thedirectimpactonCATLwouldlikelybemorecontainedthanontheaffectedOEMs.

Exhibit9.Morethan60%ofCATL-equippedvehiclescurrentlysoldinEuropearelocallyproduced

7M262025CATLEuropeexposureasoftotalEV20%17%batteryinstallation

Amidwhich

-EuropeproducedBEV60%63%

-EuropeproducedPHEV3%4%

-EuropeimportedBEV34%31%

-EuropeimportedPHEV4%1%Total100%100%

Source:RhoMotion,HSBC

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6

Moreimportantly,EuropeanOEMsincreasinglyrelyonChinesesuppliersforcost-competitiveLFPbatteries,includingforlocallymanufacturedvehicles.Asautomakerspushtowardsmore

affordableEVs,LFP’scostadvantageshouldremainrelevant.Koreanbatterymakersremain

moreheavilyfocusedonternary/NCMchemistry,whilemuchoftheirrecentLFPexpansionandcapitalallocationhasbeendirectedtowardstheUSmarket.Wethereforeseelimitedscopeformaterialnear-termdisplacementofCATLinEurope.

CATL’sglobalcompetitivepositionremainsdefensible,butitsmoatdoesnotinsulateitfrom

pricingpressure.ThekeyquestionisnotwhetherOEMswilldiversifysourcing–theywill–butwhetheralternativesupplierscanconverttacticalsharegainsintosustainable,through-cycle

competitiveness.

Exhibit10.CATL’s8M26globalEVbatteryMSwas39.4%vs39.1%in2025

50.0%

45.0%

40.0%

35.0%

30.0%

25.0%

20.0%

20222023202420258M26

CATLshareinglobalEVbatterymarket(%)CATLshareinoverseasEVbatterymarket(%)

CATLshareinChinaEVbatterymarket(%)Source:SNEResearch,HSBC

Q4.Willbatterytaxpolicychangesputpressureonpricing?

Weakerdownstreamdemandisthekeyrisktopricingpower,whilelowerlithiumcostscouldcushiontheimpactofpolicychanges.

ThebatteryexportVATrebatephase-outwasannouncedinJanuary2026,whilethe

consumptiontaxadjustmentwasannouncedinJuly.Neitherisnewinformation.ThelatestEVexportVATrebatecut,announcedon12OctoberandeffectivefromApril2027,mightfurthersqueezeOEMmarginsandstrengthentheirincentivetopushbackonbatterypriceincreases.

Exhibit11.Chinabatterytax-relatedpolicychanges

Timeline__________________

OriginalSince1April2026Since1Jan2027

ChinaBatteryexportVATrebatephase-out–announcedinJan2026

9%

6%

0%

Original

Since1Sept2026

Since1Sept2027

ChinaBatteryconsumptiontaxadjustment–announcedinJuly2026

taxfree

2%

4%

Source:MIIT,HSBC

Thekeyquestionis,therefore,notsimplytheheadlinecostimpactofthesepolicies,butwhetherweakerdownstreamdemandunderminesbatterymakers’bargainingpowerwithOEMsandESScustomers.Evenifthedirectcostburdenismanageable,asofterdemandenvironmentcould

makecontractnegotiationsmoredifficultandlimittheabilitytopassthroughpolicy-relatedcosts.

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7

Lowerlithiumpricesprovideapartialoffset.Historically,batterycontractshaveincorporatedraw-materialpass-throughmechanisms.Asaresult,lowerlithiumpricescanreducereported

batteryASPswithoutanecessaryproportionatedeclineinprofitperGWh.Lithiumcarbonate

priceshaverecentlyretreatedtoaroundRMB115k/t,versusapeakofRMB190k/tin1H26.Webelievethelowercostbasecouldpartlyoffsettheimpactofexportrebatechanges,meaningtheoverallpricingenvironmentin4Q26and2027isnotnecessarilymorechallengingthanin1H26.

Thatsaid,thebenefitdependsoncontractstructures,renewaltimingandcompetitivedynamics.

Lowerinputcostsdonotautomaticallytranslateintohighermarginsifbatterymakersarerequiredtosharethesavingswithcustomers.Conversely,headlineASPdeclinesshouldnotbeinterpretedasmargindeteriorationwithoutexaminingthecorrespondingmovementinraw-materialcosts.

Exhibit12.LithiumcarbonatepriceshaverecentlyretreatedtoaroundRMB115k/t,downfromapeakofRMB190k/tin1H26

600,000

500,000

400,000

300,000

200,000

100,000

0

Apr-17Apr-18Apr-19Apr-20Apr-21Apr-22Apr-23Apr-24Apr-25Apr-26

Lithiumcarbonateprice(RMB/ton)

Source:Wind,HSBC

ForCATL,realisedpass-throughmattersmorethanheadlineASPs.Wemonitorthree

indicators:1)Contractrenewals:Whetherpolicy-relatedcostsaresuccessfullypassedthroughtoOEMsandESScustomers.2)Grossmargins:Whetherlowerlithiumcostsoffsetpricing

pressureandanylessfavourablesalesmix.3)ProfitperGWh:WhetheruniteconomicsremainresilientdespitepotentialASPdeclinesandselectivemarket-sharetrade-offs.

Ahigherdomesticsalesmixcouldalsoweighmodestlyonmargins,asseenin2Q26.Overall,webelievethecombinationoflowerlithiumcostsandestablishedpass-throughmechanismsprovidesacushion,butnotaguarantee,againstweakerdownstreambargainingconditions.

Q5.Investmentimplications:HasCATL’scorrectiongonetoofar?

Valuationisattractive,butasustainedre-ratingrequiresgreaterconfidenceintheearningsoutlook(seeCATL:Fundamentalsontrack,sentimentyettocatchup,8September2026).

Ataround13x2027ePE,CATL’svaluationappearsincreasinglyattractiveevenbasedonamorebearishconsensus,whichassumes20%earningsgrowthnextyear.Webelievethe

marketispricinginatougherbatterycycle,whileCATL’sscale,technologyandcompetitivepositionremainlargelyintact.Thisunderpinsourcontinuedpreferenceforthestock.

Thenextcatalystislikelytobegreatervisibility,ratherthanvaluationalone.Near-termearningsresiliencecouldsupportashare-pricerecovery,butsustainedre-ratingrequiresevidenceof

threethings:improvingESSdemandconversion,resilientprofitperGWhdespitepricingpressure,andcontinuedgrowthinoverseasmarkets.Untilthen,CATLmayremain

fundamentallyattractivewithoutanimmediatecatalystformultipleexpansion.

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8

Valuation

Risks

CATL

300750CH3750HK

A/H:Buy/Buy

Currentprice:

RMB298.38HKD494.80

Targetprice:

RMB538.00HKD783.00

Upside:

+80%/+58%

WecontinuetouseaDCFmodeltovalue

CATLshares,withunchangedassumptions

includingarisk-freerateof4.25%,aChina

stockmarketpremiumof4.75%,aWACCof5.7%,withabetaof0.88,andaperpetual

growthrateof2.5%(allunchanged).OurA-

sharetargetpriceofRMB538.00(unchanged)implies80%upside;accordingly,wemaintainourBuyratingonthestock.Byapplyingan

end-2026RMB-HKDFXrateof1.17

(unchanged)andanH-to-A-sharepremiumof25%(unchanged),wederiveourH-share

targetpriceofHKD783.00(unchanged).OurH-sharetargetpriceimpliesc58%upside,andwemaintainourBuyratingonthestock.

Downsiderisks:Worse-than-expected

rawmaterialspricehikesandpass-

through;ASPandmarginpressureafter

thelaunchoftherebateprogramme;

potentiallylessfavourableregulatory

environmentinoverseasmarkets;weaker-thanexpectedexecutionofCATL’s

overseasexpansionandunfavourable

overseastariffpolicies;lower-than-

expectedEV/ESSmarketgrowthand

marketsharewins;potentialquality/IP

disputes(especiallyintheglobalmarket).

ElaineChen*|elaine.chen@|+8601057952364

Note:Pricedatcloseof12October2026.*Employedbyanon-USaffiliateofHSBCSecurities(USA)Inc.andisnotregistered/qualifiedpursuanttoFINRAregulations.

Source:Bloomberg,HSBCQianhaiSecuritiesestimates,HSBC

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9

Disclosureappendix

AnalystCertification

Thefollowinganalyst(s),economist(s),orstrategist(s)whois(are)primarilyresponsibleforthisreport,includinganyanalyst(s)whosename(s)appear(s)asauthorofanindividualsectionorsectionsofthereportandanyanalyst(s)namedasthecoveringanalyst(s)ofasubsidiarycompanyinasum-of-the-partsvaluationcertifies(y)thattheopinion(s)onthesubjectsecurity(ies)orissuer(s),anyviewsorforecastsexpressedinthesection(s)ofwhichsuchindividual(s)is(are)namedasauthor(s),andanyotherviewsorforecastsexpressedherein,includinganyviewsexpressedonthebackpageoftheresearchreport,accuratelyreflecttheirpersonalview(s)andthatnopartoftheircompensationwas,isorwillbedirectlyorindirectlyrelatedtothespecificrecommendation(s)orviewscontainedinthisresearchreport:YuqianDingandElaineChen

Importantdisclosures

Equities:Stockratingsandbasisforfinancialanalysis

HSBCanditsaffiliates,includingtheissuerofthisreport(“HSBC”)believesaninvestor'sdecisiontobuyorsellastockshoulddependonindividualcircumstancessuchastheinvestor'sexistingholdings,risktoleranceandotherconsiderationsandthatinvestorsutilisevariousdisciplinesandinvestmenthorizonswhenmakinginvestmentdecisions.Ratingsshouldnotbeusedorreliedoninisolationasinvestmentadvice.Differentsecuritiesfirmsuseavarietyofratingstermsaswellasdifferentratingsystemstodescribetheirrecommendationsandthereforeinvestorsshouldcarefullyreadthedefinitionsoftheratingsusedineachresearchreport.Further,investorsshouldcarefullyreadtheentireresearchreportandnotinferitscontentsfromtheratingbecauseresearchreportscontainmorecompleteinformationconcerningtheanalysts'viewsandthebasisfortherating.

HSBCassignsratingsonthefollowingbasis:

Thetargetpriceisbasedontheanalyst’sassessmentofthestock’sactualcurrentvalue,althoughweexpectittotakesixto12monthsforthemarketpricetoreflectthis.Whenthetargetpriceismorethan20%abovethecurrentshareprice,thestockwillbeclassifiedasaBuy;whenitisbetween5%and20%abovethecurrentshareprice,thestockmaybeclassifiedasaBuyoraHold;whenitisbetween5%belowand5%abovethecurrentshareprice,thestockwillbeclassifiedasaHold;whenitisbetween5%and20%belowthecurrentshareprice,thestockmaybeclassifiedasaHoldoraReduce;andwhenitismorethan20%belowthecurrentshareprice,thestockwillbeclassifiedasaReduce.

Ourratingsarere-calibratedagainstthesebandsatthetimeofany'materialchange'(initiationorresumptionofcoverage,changeintargetpriceorestimates).

Upside/Downsideisthepercentagedifferencebetweenthetargetpriceandtheshareprice.

Ratingdistributionforlong-terminvestmentopportunities

Asof30September2026,thedistributionofallindependentratingspublishedbyHSBCisasfollows:

Buy60%(12%oftheseprovidedwithInvestmentBankingServicesinthepast12months)

Hold35%(12%oftheseprovidedwithInvestmentBankingServicesinthepast12months)

Sell4%(10%oftheseprovidedwithInvestmentBankingServicesinthepast12months)

Forthepurposesofthedistributionabovethefollowingmappingstructureisusedduringthetransitionfromtheprevioustocurrentratingmodels:underourpreviousmodel,Overweight=Buy,Neutral=HoldandUnderweight=Sell;underourcurrentmodelBuy=Buy,Hold=HoldandReduce=Sell.Forratingdefinitionsunderbothmodels,pleasesee“Stockratingsandbasisforfinancialanalysis”above.

Forthedistributionofnon-independentratingspublishedbyHSBC,pleaseseethedisclosurepageavailableat

/gbm/financial-regulation/investment-recommendations-disclosures.

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Sharepriceandratingchangesforlong-terminvestmentopportunities

CATL(3750.HK)sharepriceperformanceHKDVsHSBCRating&targetpricehistory

ratinghistory

746

696

646

596

546

496

446

396

346

296

ElaineChen