---
endpoint: analytics
pattern: 03 · House view · stance
status: done
latency_ms: 178756
conversation_id: f2f2822d-8623-4a28-9bc5-4959beb00477
citations: 0
created: 2026-05-31 16:57:04Z
---

# Is CLSA incrementally more positive or negative on CATL — and why?

# CLSA on CATL: Incrementally MORE POSITIVE

CLSA has turned **incrementally more constructive** on CATL across its last five primary notes (Apr 14 → Jun 10, 2025), with both a **formal rating upgrade** (O-PF → HC O-PF) and **cumulative target-price hikes** (CATL-A: Rmb320 → Rmb380; CATL-H new HK$385 → HK$447). Lead analyst: **Horace Tse**, supported by Forest Chan and Samantha Chin.

## Rating & Target-Price Trajectory

| Report Date | Title | Rating (A / H) | TP (A / H) | Key Move |
|---|---|---|---|---|
| 14-Apr-2025 | Staying the course | O-PF / – | Rmb320 / – | EPS +1–2%, TP held [5] |
| 21-Apr-2025 | Leading the pack | O-PF / – | **Rmb335** / – | TP raise on Tech Day; power-battery multiple 12x → 13x [8][9] |
| 20-May-2025 | A new era | **HC O-PF** / **HC O-PF (initiate)** | **Rmb380** / **HK$385** | **Formal upgrade** post HK listing [11][13] |
| 25-May-2025 | A new normal? | HC O-PF / HC O-PF | Rmb380 / HK$385 | Reiterate; flag upside risk to H discount [16][18] |
| 10-Jun-2025 | Green shoots | HC O-PF / HC O-PF | Rmb380 / **HK$447** | CATL-H TP raised by HK$62 (+16%) [1][3] |

Implied upside on the most recent print: **+56% (A) / +48% (H)** [4].

## What Drove the Incrementally Bullish Path

**1. 1Q25 results were the "all clear" on margins (14-Apr).**
- Gross margin returned to expansion mode at **24.4%, +1.3ppt YoY / +1.2ppt QoQ** [7], easing fears raised at the 4Q24 print.
- The German plant **turned profitable in 1Q25** — a positive read-through to Hungary and the Stellantis JV in Spain [7].
- Europe market share hit **a record 38%**; management framed US-tariff earnings risk as "low-single-digit" [6].

**2. Tech Day on 21-Apr re-rated the multiple, not just earnings.**
- Naxtra sodium-ion battery (~175 Wh/kg, ~500km range) targeted for commercial production by end-2025 [8].
- 2nd-gen Shenxing LFP: 12C peak charging, **520km in a 5-min charge, up to 800km full capacity — at parity with BYD's offering** [10].
- CLSA raised the power-battery EV/EBITDA target multiple from 12x to 13x; TP +Rmb15 to Rmb335 [9].

**3. HK listing was the trigger for the formal upgrade (20-May).**
- CATL completed its HK listing raising **US$4.6bn at HK$263**, on a balance sheet already carrying **~US$45bn cash** to fund European capex and solid-state R&D [11].
- CLSA: market overhangs (IPO, tariff noise) had "overshadowed" intrinsic value — time to refocus [11].
- **Upgrade rationale**: roll-forward to 26CL multiples, margin assumptions lifted, 26-27CL NP +0.5–2.0%; TP Rmb335 → Rmb380; **initiated CATL-H at HC O-PF / HK$385** (5% H-share discount to A) [13].
- Tariff worst-case quantified: ~9% of sales at risk (ESS US exposure), but actual hit lower due to pricing power [15].

**4. The H-share has rerated above CLSA's framework (25-May → 10-Jun).**
- CATL-H rallied **23% post-listing** vs CATL-A +3%, putting it at **11% premium to A — unseen since 2014** [17]. BYD-H trading at a 5% premium reinforced "new normal" thesis [18].
- By 10-Jun, the H-A premium had **sustained at ~12%**; CLSA flipped its assumption from a 5% discount to a **10% premium**, lifting CATL-H TP **HK$385 → HK$447** [3]. CATL-A TP unchanged at Rmb380 [3].

**5. Premium-EV positioning is the new defensive overlay (10-Jun).**
- CLSA's own China auto team cut China EV growth to **~10% Cagr through 2030** [1] — yet CATL specifically gets a positive read-through because:
- CATL holds **72% market share in China's high-end (>Rmb300k) passenger EV battery market** [2], the under-penetrated end of the curve with better ASP/margin than mass-market.

## Caveats / What Could Reverse the Tone
CLSA explicitly flags four risks across the run: (i) EV adoption deceleration, (ii) adverse policy/tariff action on Chinese components, (iii) commoditisation, and (iv) failure to maintain technological differentiation. The recent TP hikes have come from **multiple expansion and H-share premium remarking, not earnings upgrades** — 25-27CL NP forecasts were only +0.5–2.0% at the upgrade and unchanged in June. If China EV slows faster than the team's 10% Cagr base case OR the H-A premium normalises, the easiest part of the bull case unwinds first.

## Bottom Line
CLSA has moved from **"hold the line" (Apr 14)** to **"buy with conviction across both listings, and H deserves a premium" (Jun 10)**. The shift was earnings-validated (1Q25 margin inflection), product-catalysed (Tech Day), and structurally re-anchored by the HK listing — with the latest delta being a HK$62 (+16%) bump to the CATL-H TP on a sustained A-H premium.

---
**Sources**
[1] CATL (Green shoots) — CLSA (10 Jun 2025) — 607961671LinqAlpha.PDF
[2] CATL (Green shoots) — CLSA (10 Jun 2025) — 607961671LinqAlpha.PDF
[3] CATL (Green shoots) — CLSA (10 Jun 2025) — 607961671LinqAlpha.PDF
[4] CATL (Green shoots) — CLSA (10 Jun 2025) — 607961671LinqAlpha.PDF
[5] CATL — Staying the course (O-PF) — CLSA (14 Apr 2025) — 607955907LinqAlpha.PDF
[6] CATL — Staying the course (O-PF) — CLSA (14 Apr 2025) — 607955907LinqAlpha.PDF
[7] CATL — Staying the course (O-PF) — CLSA (14 Apr 2025) — 607955907LinqAlpha.PDF
[8] CATL — Leading the pack (O-PF) — CLSA (21 Apr 2025) — 607956446LinqAlpha.PDF
[9] CATL — Leading the pack (O-PF) — CLSA (21 Apr 2025) — 607956446LinqAlpha.PDF
[10] CATL — Leading the pack (O-PF) — CLSA (21 Apr 2025) — 607956446LinqAlpha.PDF
[11] CATL — A new era (HC O-PF) — CLSA (20 May 2025) — 607959766LinqAlpha.PDF
[12] CATL — A new era (HC O-PF) — CLSA (20 May 2025) — 607959766LinqAlpha.PDF
[13] CATL — A new era (HC O-PF) — CLSA (20 May 2025) — 607959766LinqAlpha.PDF
[14] CATL — A new era (HC O-PF) — CLSA (20 May 2025) — 607959766LinqAlpha.PDF
[15] CATL — A new era (HC O-PF) — CLSA (20 May 2025) — 607959766LinqAlpha.PDF
[16] CATL — A new normal? (HC O-PF A/H) — CLSA (25 May 2025) — 607960433LinqAlpha.PDF
[17] CATL — A new normal? (HC O-PF A/H) — CLSA (25 May 2025) — 607960433LinqAlpha.PDF
[18] CATL — A new normal? (HC O-PF A/H) — CLSA (25 May 2025) — 607960433LinqAlpha.PDF

