Citi: CATL Profits Set to Stabilize; Stock Pullback Offers Long-Term Buying Opportunity

Citi’s latest report notes that although Zimbabwe’s lithium export ban could push up lithium prices, squeeze battery makers’ short-term profit margins, and weigh on CATL’s share price, the company’s net profit per watt-hour of batteries is still expected to remain stable at RMB 0.11. Analyst Jack Shang believes CATL possesses strong cost-pass-through capabilities and a comprehensive vertical integration across the entire supply chain, enabling it to effectively cushion the impact of rising raw material costs. The report emphasizes that the current share price weakness presents a compelling buying opportunity for long-term investors. Key near-term catalysts include management guidance following the annual results announcement on March 9 and potential progress on the restart of lithium mining operations in Jiangxi province. In the short term, Citi remains more bullish on lithium resource companies such as Ganfeng Lithium.