Morgan Stanley has issued a research note indicating that CATL (03750)'s recent stock price pressure is primarily attributed to imminent fund rotations. As the largest non-AI holding in domestic institutional fund portfolios, CATL is expected to see some capital shift ahead of the upcoming STAR Market IPO of ChangXin Memory Technologies. The market is also attentive to risks such as declining lithium prices, a slowdown in energy storage deployment growth, and a moderated production schedule increase in July. However, the firm believes these concerns do not pose a significant adverse impact.

Morgan Stanley continues to view CATL's production schedule as healthy. The bank anticipates that after several years of exceptionally high growth, the normalization of growth rates in the energy storage business is expected. It maintains confidence in the company's medium-term outlook. Consequently, Morgan Stanley reaffirms its "Overweight" rating on CATL, keeping the target price unchanged at HK$815 and listing it as a top sector pick.