The world's largest battery manufacturer saw its stock price slide to 232.33 yuan in Shenzhen as investors reacted to a combination of thinning margins and rising operational expenses. While the company posted a 14.5% increase in net profit to 21.25 billion yuan, the figure fell short of analyst projections. Revenue climbed 59% to 165.22 billion yuan, yet profitability concerns dominated the market response.
In section Market Quotes
CATL Shares Tumble Following Quarterly Profit Miss
A 10% plunge in share value hit Contemporary Amperex Technology on Wednesday, marking the battery giant's sharpest daily decline in eighteen months. The sell-off followed a third-quarter earnings report that failed to meet market expectations, prompting a wave of downward revisions from major investment firms tracking the sector.
Analysts at Citi pointed to a 19.3% gross margin as the primary catalyst for the miss, citing a shift in product mix and new tax burdens, including a reduced export rebate and a reinstated battery consumption tax. Consequently, Citi lowered its target price for CATL to 479 yuan from 500 yuan. Nomura echoed these concerns regarding unit profitability, slashing its target price more aggressively from 632 yuan to 408 yuan. Despite the immediate financial friction, Nomura maintained a constructive long-term outlook, banking on steady electric-vehicle adoption across Europe and emerging markets alongside sustained growth in global energy-storage demand.
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