BOCI Securities: Sales of new energy vehicles expected to maintain rapid growth, maintaining an industry rating of "outperform the market".

Bank of China International released a research report stating that under the guidance of the "15th Five-Year Plan", the production and sales of new energy vehicles are expected to maintain rapid growth, and lithium batteries are expected to become the core support of the new energy system. Solid-state batteries, as the direction of upgrade for the lithium battery industry in the future, are expected to achieve large-scale applications in the field of new energy vehicles. In terms of new energy generation, under the guidance of the "Recommendations", the proportion of new energy generation is expected to gradually increase, helping China to achieve carbon peak. "Anti-internal loop" continues to advance, and the prices of the industry chain are expected to gradually recover. The installation capacity of new energy storage is also expected to grow rapidly. The bank believes that the release of the "Recommendations" is favorable for the high-quality development of the industry chain, and industry chain companies are expected to benefit. Maintain a rating of stronger than the market for the industry. The main points of Bank of China International are as follows: Clean energy enters a phase of high-quality development, and new energy storage has great potential. The "Recommendations" clearly state the continuous increase in the proportion of new energy supply, and at the same time propose to coordinate local consumption and external transmission to promote the high-quality development of clean energy. The bank believes that the development of new energy has entered a new stage, and downstream industries such as energy storage, hydrogen energy, and green parks have ushered in development opportunities. In addition, the "Recommendations" clearly state that China will vigorously develop new types of energy storage. According to data from the National Energy Administration, by the end of 2024, the country's renewable energy generation will add 373 million kilowatts, an increase of 23% year-on-year, accounting for 86% of the new installed power generation capacity; By 2024, the country's renewable energy generation capacity will reach 3.47 trillion kilowatt-hours, accounting for approximately 35.2% of all electricity generation. New energy has become one of China's main energy sources. Due to the fluctuating nature of wind and solar power generation, energy storage can smooth the fluctuations in wind and solar power output, providing broad development opportunities in the future. Clear goals for carbon peak, new formats such as zero-carbon parks usher in development opportunities. On September 22, 2020, General Secretary Xi solemnly announced: "China's carbon dioxide emissions will strive to peak before 2030, and strive to achieve carbon neutrality before 2060." The "Recommendations" clearly state that China will actively and steadily promote the achievement of carbon peak, and implement a dual control system for total carbon emissions and intensity. Against the background of improving the carbon emission accounting system, new business formats such as zero-carbon factories, zero-carbon parks, and green hydrogen applications are effective options for energy conservation and emission reduction. "Anti-internal loop" continues to deepen, optimistic about the restoration of prices in the photovoltaic industry chain. The "Recommendations" proposes to build a strong domestic market, accelerate the construction of a new development pattern, and resolutely eliminate obstacles that hinder the construction of a unified large market across the country. Comprehensive rectification of "internal loop" competition, strengthening anti-monopoly and anti-unfair competition law enforcement judicial, and forming a market order of high quality, fair competition. The bank believes that with the continuous deepening of "anti-internal loop", the prices of the photovoltaic industry chain in China are expected to be restored. The solid-state battery industry is expected to develop rapidly. The "Recommendations" propose to focus on building emerging pillar industries. Implement industrial innovation projects, promote the integrated development of innovative facilities construction, technological research and development, and product iteration and upgrading, accelerate the development of strategic emerging industry clusters such as new energy, new materials, aerospace, and low-altitude economy. Improve the industrial ecosystem, implement large-scale application demonstration actions of new technologies, products and scenarios, and accelerate the scale development of emerging industries. Solid-state batteries are the direction of technological upgrade for the next generation of lithium battery technology. With the continuous maturity of technology and products, solid-state batteries are expected to be the first to be applied in new energy vehicles and are expected to achieve large-scale development in the future.