CATL's market value has surpassed Kweichow Moutai, becoming the third largest listed company in China!

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CATL’s stock price hit a record high on Thursday, with a market capitalization reaching 1.83 trillion yuan, surpassing Kweichow Moutai’s 1.8 trillion yuan valuation to become China’s third largest domestically listed company.

CATL’s stock surged by as much as 6%, currently at 393.25 yuan, with a total increase of 30% this month. Daiwa Capital Markets Hong Kong analyst Kelvin Lau stated that the battery sector has good prospects, and some investors may be rotating from EV stocks to battery stocks, benefiting CATL as the industry leader.

Morgan Stanley’s on-site research this week showed that CATL continues to build competitive moats through its self-developed, highly complex intelligent manufacturing lines and advanced materials science technology. The firm maintained its “Overweight” rating with a target price of 425 yuan, representing an 8% upside from current levels.

As the world’s largest battery maker, CATL holds a dominant position in the rapidly growing Energy Storage System (ESS) field. Investors anticipate this advantage will translate into a key driving force for future profit growth.

Intelligent Manufacturing Builds a Technological Moat

Morgan Stanley’s on-site investigations found that CATL’s manufacturing capabilities have reached industry-leading levels. The company’s factories produce 2.2 million battery cells per day, have over 6,800 real-time quality control points, and process 340,000 data transactions per second, resulting in a highly intelligent production system.

This extremely high complexity and level of intelligence in manufacturing lines, combined with advanced molecular-level materials science, have created a technical barrier that is hard to replicate, giving CATL a premium on quality and a competitive cost advantage.

CATL currently has abundant orders with a capacity utilization rate above 90%. The company is building 250 GWh of new capacity, aiming to increase total capacity to 1 TWh next year to meet growing market demand.

Energy Storage Business Shows Profit Advantages

In the energy storage systems business, CATL’s products demonstrate significant economic value. According to Morgan Stanley, the company’s products can bring about a 14 percentage point internal rate of return (IRR) premium to customers in the global market, and a 7-8 percentage point premium in the Chinese market.

This profit advantage reflects CATL’s leading position in energy storage technology. As the global energy transition accelerates, demand for energy storage is growing rapidly, providing strong support for the company’s future performance growth.

Morgan Stanley sees huge potential in CATL’s energy storage business, especially following breakthroughs in the European market, where the company is expected to further expand its market share.

Industry Leadership Continues to Strengthen

Morgan Stanley’s September 11th report points out that CATL’s industry leadership has not weakened, but instead has been further strengthened in competition. As smaller rivals struggle with profitability in the critical energy storage sector, CATL’s competitive advantages become more obvious.

The investment bank believes that the currently hyped solid-state battery technology is short-term speculation, and CATL’s technological edge will persist. In terms of valuation, the company is already notably attractive compared to its peers, becoming “the cheapest in the industry.”

Based on a 15x EV/EBITDA multiple of expected 2026 EBITDA, Morgan Stanley set a target price of 425 yuan, asserting CATL’s moat remains solid and its long-term investment value stands out.

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