REPT BATTERO (00666): Searching for a new turning point for profitability at the bottom of the cycle.

In the past year, the global lithium battery industry undoubtedly experienced a severe test. The drastic fluctuations in upstream raw material prices and the unprecedented intense price wars in the downstream sector have squeezed the profit margins of the entire industry, accelerating the industry reshuffle. However, in this challenging and opportunistic environment, a few leading companies such as REPT BATTERO (00666) have defied the trend, with its stock price rising by nearly 60% from its low point earlier in the year, attracting market attention. What factors have driven the market to reassess the value of REPT BATTERO? At an investor presentation held in Hong Kong, the deep logic behind its strong stock price performance was revealed. Counter-trend growth: "Dual-drive" and cost control create a turning point in performance For a growing manufacturing company, the most solid rationale for an upward trend lies in the significant improvement in its operational fundamentals. Financial data shows that the company achieved revenue of RMB 9.49 billion in the first half of the year, a year-on-year increase of 24.9%. More importantly, the profitability has improved significantly: gross profit soared by 177.8% year-on-year to RMB 829 million, with a gross margin jumping from 3.9% in the same period last year to 8.7%. Thanks to outstanding cost control and economies of scale, the company's net loss narrowed significantly by 90.5% from RMB 658 million in the same period last year to RMB 63 million, approaching the breakeven point. Behind the improvement in profitability is the explosive growth in sales volume. During the reporting period, REPT BATTERO sold a total of 32.4 GWh of lithium battery products, a year-on-year increase of 100.2%. Among them, the "Dual-drive" of energy storage batteries and power batteries saw shipments of 18.87 GWh (an increase of 119.3%) and 13.53 GWh (an increase of 78.5%) respectively, both exceeding the industry average growth rate, demonstrating the company's strong market development capabilities and customer recognition. In the first half of 2025, the company ranked among the top five in global shipments of energy storage cells, with residential energy storage cell shipments ranking first in the world; in the domestic market, the company's new energy heavy-duty truck and swap battery heavy-duty truck battery installations ranked second nationwide. These leading positions in specific segments have not only brought about economies of scale but also built differentiated competitive advantages for the company. At a recent investor meeting, the company's management team provided detailed explanations of its business progress. In terms of power batteries, the company has stable cooperation with several leading domestic and international automakers, securing designated models in the plug-in hybrid (PHEV) and extended-range (EREV) markets. It is expected that four models with monthly sales exceeding 10,000 units will be launched in the second half of the year, indicating clear growth momentum. In the energy storage business, the company has deepened cooperation with leading integrators, successfully integrated into the international mainstream supply chain, and has signed purchase agreements for over 20GWh, widely recognized for its market competitiveness, becoming a strong guarantee for the company's sustained performance improvement. Core barriers across cycles: Industrial chain synergy and technological innovation If short-term performance improvement is the catalyst for stock price appreciation, then unique competitive advantages and forward-looking technology layout are the core support for the long-term value of REPT BATTERO. One of the distinctive features of REPT BATTERO is its strong industrial background backed by the global stainless steel and nickel metal giant, Qingshan Industrial. Currently, Qingshan Industrial is not only a global leader in traditional business areas but has also extended its industrial chain to core resources such as lithium and cobalt in the upstream of new energy. This shareholder structure has formed an irreplicable industrial chain synergy "moat" for REPT BATTERO, enabling it to obtain long-term, stable, and cost-effective supply guarantees in periods of drastic fluctuations in raw material prices, thereby giving it stronger bargaining power and risk mitigation capabilities in industry competition. On the front of technological innovation, REPT BATTERO not only relies on cost advantages but also adheres to driving product iterations through technology. Its core "Qing" technology has significantly improved the energy density and safety of battery cells through structural innovation, giving the products strong competitiveness in the energy storage market, especially in the residential energy storage sector with high safety requirements, becoming a weapon for the company to build differentiated competitive advantages. As of now, the total shipment volume of the "Qing" series products has exceeded 20GWh, with increasing market recognition. In the field of solid-state batteries with deep technological reserves, achievements are entering a substantial implementation stage. The first-generation products have been delivered to a leading international automaker in Europe. At the same time, the second-generation products have not only been completed but have also been sampled to multiple mainstream automakers at home and abroad, progressing to the testing phase. Moreover, seizing the trend of the "low-altitude economy," the company has developed dedicated battery cells with an energy density exceeding 310Wh/kg and has reached a strategic cooperation with the industry newcomer Yufeng Future. In the field of circular economy, the company has obtained qualifications for stepwise utilization and has signed strategic cooperation agreements with industry leaders such as GEM Co., Ltd., and Huayou Recycling, seizing the opportunity in this potentially huge market. Conclusion The strong performance of REPT BATTERO in recent times is the result of multiple resonating factors such as improving fundamentals, unique industrial chain advantages, and the recovery of industry sentiment. The performance nearing breakeven in the first half of the year signifies the initial effectiveness of the company's strategy, with the tipping point in profitability possibly approaching. Its cost protection moat backed by Qingshan Industrial, together with continuous innovations in the "Qing" technology, solid-state batteries, and emerging applications, collectively constitute its core competitive strengths across cycles. Looking ahead, as the energy storage market gradually emerges from price wars and with accelerated globalization, REPT BATTERO's growth potential is expected to further open up. Despite fierce industry competition, the company has presented an impressive report card to the market, proving its growth potential and long-term value in the new energy wave.