UBS: Oil Price Volatility Boosts EV Value—BYD, CATL, Li Auto Rated "Buy"

UBS's latest research report notes that the current Middle East situation has driven up international oil prices, reminiscent of the surge in energy and commodity prices during the Russia-Ukraine conflict in 2022. While this simultaneously increases operating costs for fuel-powered vehicles and manufacturing costs for electric vehicles (EVs), the total cost of ownership for EVs is becoming increasingly attractive. As a result, Chinese auto and new energy stocks rose today, with Geely Automobile climbing 8.5% to HK$17.44 and Contemporary Amperex Technology Co. Limited (CATL) gaining 7.5% to HK$591. UBS maintains its "Buy" rating on BYD Company, CATL, and Li Auto, citing their favorable risk-reward profiles.