CITIC Securities: Improvement in supply and demand drives prices to stabilize, bullish on the value of battery configuration.

China Securities research report believes that at the current point in time, we clearly see the value of allocating to China's battery core assets. In the short term, the continuous improvement in supply and demand in Q2 25 is expected to stabilize battery prices, with upstream raw material costs decreasing and production rates increasing to bring additional profit elasticity, and the battery sector's performance is expected to exceed expectations. In the medium to long term, the trend of supply and demand improvement remains clear, while the commercialization of electric vehicles, AI data centers, and overseas markets are still expected to bring excess growth to leading companies. In terms of valuation, China's battery core assets still have significant advantages over Japanese and Korean companies. With more battery companies listing on the H share market in the future, under the global fund pricing system, the valuation center of China's battery assets is expected to be further raised.