CATL Bets on AI-Driven Research and Sodium-Ion Storage as Brokers Slash Price Targets
Published on 10/31/2026 at 20:21 | Editorial boerse-global.de
CATL's founder and chairman Robin Zeng believes today's batteries simply don't pack enough energy density to unlock broader applications — and he wants electrochemistry to move faster. Speaking at the opening forum of the World Laureates Forum, Zeng called for accelerated progress in the field, with artificial intelligence cast as a key enabler. For investors, the remarks land against a tougher question: how the battery giant can convert technological advances into durable earnings while a price war squeezes the business.
Zeng Pushes for Deeper Research
CATL already deploys large language models in scientific discovery, drawing on more than a trillion test datasets. An internal AI-focused research system links wet and dry laboratories. Even so, Zeng said the efforts so far are "not yet enough," pointing in particular to the need for support from electrochemists. Alongside AI, international scientific expertise is meant to speed development.
His comments describe an ongoing research gap rather than a completed technological leap. They concern the development of more powerful batteries and amount to neither a concrete earnings forecast nor a commitment on when additional applications will become commercially viable.
New Business Lines Face Entrenched Rivals
Alongside research, CATL is stepping up investment in battery swapping and energy storage. According to a report by the South China Morning Post, the company is hunting for additional growth drivers as price competition intensifies and margin pressure mounts. In storage, CATL has set up a new subsidiary with registered capital of 5 billion yuan, which is also to develop AI software. On Tuesday, the company announced a partnership with Germany's Intilion on a sodium-ion battery project with 3 gigawatt-hours of capacity.
Should investors sell immediately? Or is it worth buying CATL?
The expansion does not lead CATL into uncontested markets. Nio is already established in battery swapping, and BYD in storage. Lucas Zhang of WaterRock Energy Economics describes competition in both areas as already intense.
Technology development and business expansion therefore serve different purposes: research is meant to open up additional use cases, while swapping and storage are intended to deliver new growth contributions. In the near term, though, these initiatives do not replace the development of earnings power in the existing business.
Brokers Cut Targets After a Weak Quarter
The market's near-term verdict has been blunt. UOB Kay Hian kept its buy rating but cut its price target sharply, citing quarterly profit that fell short of expectations. For the A-shares, the brokerage lowered its valuation mark from RMB 585 to RMB 343, while maintaining its buy recommendation on that share class as well.
Morgan Stanley had already moved on Monday, downgrading the H-shares from "overweight" to "equal-weight" and cutting the corresponding target from HK$705 to HK$390, according to media reports. For the A-shares, the house lowered its target from RMB 500 to RMB 335 but stuck with its buy rating — meaning that, unlike UOB Kay Hian, Morgan Stanley also changed its rating on the H-shares.
Indonesia Plant Starts Up as Deals Pile In
On the operational front, the news flow has been brisk. The sodium-ion agreement with Intilion is set to deploy energy storage systems with capacity of up to 3 GWh in Europe over five years, with CATL describing it as a letter of intent. On Thursday, CATL and Dongfeng Motor reportedly signed a strategic cooperation agreement to develop technologies and systems for ultra-fast charging and battery swapping.
CATL at a turning point? This analysis reveals what investors need to know now.
Also on Thursday, news agency Antara reported that the joint Indonesian battery plant of CATL and Antam had begun production. Indonesia's coordinating minister said, according to the report, that President Prabowo is expected to officiate at the inauguration soon.
Profitability Remains the Deciding Factor
Growth in CATL's quarterly profit has slowed markedly of late. Morgan Stanley warns that the price war will further weigh on the fundamental business, arguing that relief depends on larger earnings contributions from battery exports and the high-margin storage business. Fitch, by contrast, sees signs that profitability may be close to bottoming out. Renegotiated customer contracts are expected to take effect after the fourth quarter, while a shift in deliveries toward more profitable products could improve results.
Zeng's research push thus addresses long-term technological competitiveness. For near-term earnings, contract terms, product mix and the contributions of the new growth businesses remain decisive. AI, in that equation, is a development tool — not yet a proven offset to margin pressure.
Ad
CATL Stock: New Analysis - 31 October
Fresh CATL information released. What's the impact for investors? Our latest independent report examines recent figures and market trends.
