CATL’s 75% Surge Hints at a Broader Revaluation - Triple Re-rating from AI, Batteries, and Globalization

TradingKey - Shares of CATL (Contemporary Amperex Technology Co. Limited), the world’s leading battery manufacturer, have surged 75% from April lows, yet analysts still view it as the “cheapest battery stock globally”, suggesting that its share price has not yet caught up with its earnings power — especially amid surging global demand for energy storage systems (ESS) driven by artificial intelligence.

On Friday, September 19, CATL’s A-shares rose 0.44% and its Hong Kong-listed shares gained 2.08%, bringing year-to-date gains to 42.40% and 74.81%, respectively. 

Since hitting its April low, the company’s market cap on the Shenzhen exchange has soared by over $110 billion.

Despite this strong rebound, institutions like JPMorgan and BNP Paribas argue that CATL’s stock still does not fully reflect its future growth potential, given the rapid expansion and dominance of its energy storage system (ESS) business.

According to Bloomberg, CATL currently trades at 22 times forward earnings, the lowest valuation among pure-play battery manufacturers.

As per Global Market Insights, the ESS market is projected to grow from $66.87 billion in 2024 to $512 billion by 2034, representing a 21.7% compound annual growth rate (CAGR).

Analysts note that the AI boom is driving soaring electricity demand — particularly from data centers — prompting more companies to adopt ESS solutions to manage peak load demands and avoid costly infrastructure upgrades.

A portfolio manager at BNP Paribas Asset Management said that ESS is the fastest way to scale power capacity, and it heavily relies on lithium iron phosphate (LFP) batteries — precisely where CATL excels.

Lyon Securities added that China’s recent launch of a national energy storage development plan marks the beginning of CATL’s re-rating, a trend expected to continue through year-end. Thanks to economies of scale and supply chain optimization, CATL achieves higher profitability than peers in ESS battery production.

In addition, CATL’s global expansion is providing another powerful tailwind for both earnings and share price growth. 

In May, the company completed Hong Kong’s largest equity offering of 2025, raising around $4.6 billion. Meanwhile, its projects in Hungary, Spain, and Indonesia are progressing steadily.

Morgan Stanley, in a recent report, noted that while smaller competitors struggle with profitability in key ESS markets, CATL has made breakthroughs in Europe.

Through on-the-ground inspections, Morgan Stanley found that CATL holds a critical edge: advanced materials science at the molecular level, combined with cost leadership. Its production lines consist of over 25,000 component units, are highly complex, and mostly self-designed — making them extremely difficult for rivals to replicate.