CICC Leon: Korean battery company receives another order from Tesla, Inc. (TSLA.US), limited impact on Contemporary Amperex Technology (03750), reiterates "outperform" rating.

CICC Lyon released a research report stating that a South Korean battery manufacturer received a second energy storage system (ESS) supply order from Tesla, Inc. (TSLA.US), which may seem disadvantageous for Contemporary Amperex Technology (03750). However, with the strong growth of the global energy storage market, it is difficult for Contemporary Amperex Technology alone to meet market demand, and more suppliers need to participate. The bank believes that a more important catalyst for Contemporary Amperex Technology is if US tariffs or policy environment improve, leading to a breakthrough in the US market, which would significantly boost market confidence. The bank maintains a target price of HK$685 for the group and reiterates its "outperform the market" rating. The report indicates that in the context of market growth, the impact on Contemporary Amperex Technology is not as negative as it may initially appear. Assuming that the growth rate of Tesla, Inc.'s energy storage business is in line with the bank's predicted 19% compound annual growth rate of the US energy storage market from 2026 to 2030, and considering the supply contracts with Samsung Electronics and LG Energy Solutions, Contemporary Amperex Technology's remaining energy storage supply corresponds to a compound annual growth rate of 14% from 2026 to 2030, with a market share of 85% by 2030, which is significant. Furthermore, due to the current uncertainty in the market due to tariffs, the expectations for Contemporary Amperex Technology's opportunities in the US market are almost zero, and the short-term impact will also be very limited.