Goldman Sachs: Maintains a cautious view on the sustainable increase in battery prices, preferring Contemporary Amperex Technology and Guoxuan High-Tech.

Goldman Sachs issued a report stating that the Wandai China Lithium Battery Index has risen by about 40% in the past 60 trading days, significantly outperforming the 18% increase of the Shanghai and Shenzhen 300 Index. The bank believes that although the short-term battery market is tight, it maintains a cautious view on the sustainability of battery price increases. Their sensitivity analysis shows that a 10% price increase could bring a profit increase of 30% to 60% next year, with Guoxuan High-Tech, Contemporary Amperex Technology, and EVE Energy having relatively high sensitivity to prices. The bank believes that the recent increase in battery stock prices reflects expectations of a 2% to 5% increase in average selling prices next year. The bank prefers Ningde Times and Guoxuan High-Tech, believing that both will benefit from cyclical recovery and attractive valuations. The bank has a target price of 369 yuan for Ningde Times A shares, with a "buy" rating, and a target price of 470 Hong Kong dollars for H shares, with a "neutral" rating; and a target price of 54.8 yuan for Guoxuan High-Tech, with a "buy" rating.