JPMorgan released a research report stating that it has raised CATL's (03750) profit forecast by 5% to reflect better-than-expected performance, and increased the H-share target price from HK$400 to HK$415, equivalent to a combined price-to-earnings ratio of 20x for 2026 and 2027. Given that H-shares have already gained 62% since listing and valuations have become reasonable (H-shares are trading at 26.9x and 22x projected P/E for this year and next year respectively), the firm downgraded the rating from "Overweight" to "Neutral", emphasizing that this downgrade is purely based on valuation considerations. Meanwhile, Contemporary Amperex Technology Co.,Ltd. A-shares (300750.SZ) remain the firm's top pick in China's battery industry, maintaining an "Overweight" rating, with A-shares currently valued at 19.1x and 15.7x projected P/E for this year and next year respectively.

The report noted that CATL's second quarter sales volume reached approximately 150 GWh, with net profit of about RMB 16.5 billion, both exceeding the firm's expectations. However, the outperformance may have been anticipated by the market, as the company's H-shares and A-shares rose 24% and 10% respectively over the past 9 trading days, while the Hang Seng Index gained 4% during the same period. Currently, CATL H-shares trade at a premium of over 40% compared to A-shares.