CATL's Expansion Drive Meets a Wall of Downgrades as Two Brokers Trim Price Targets
Published on 10/31/2026 at 16:50 | Editorial boerse-global.de
CATL has spent the past week signing partnership after partnership and confirming production milestones, but the market's attention is fixed on a less flattering development: two brokerages have slashed their price targets on the battery giant, and one has cut its rating on the Hong Kong-listed shares.
Morgan Stanley moved first, according to media reports, downgrading the H-shares from "Overweight" to "In-Line" on Monday and cutting its target to HK$390 from HK$705. The investment bank cited less favorable product-mix shifts than anticipated and several cost pressures. For the A-shares, Morgan Stanley kept its "Overweight" rating but removed the stock from its list of preferred picks, while lowering the target to RMB 335 from RMB 500.
UOB Kay Hian took a different tack. The brokerage retained its buy recommendation on both share classes, pointing to a quarterly profit that came in below expectations. It nevertheless set a markedly lower valuation mark for the A-shares, reducing its target to RMB 343 from RMB 585. The buy call remains in place for that share class as well.
A Quarter That Grew, Just Not Fast Enough
The downgrades followed CATL's third-quarter 2026 results, released on October 20, which showed a net profit attributable to shareholders of RMB 21.246 billion. That represented year-on-year growth of 14.54%. Reuters highlighted the deceleration in earnings growth, pointing to fierce competition and slowing growth in Chinese car sales.
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Charging, Swapping and a Sodium-Ion Bet
On the operational front, CATL has been unusually busy. On Thursday in Wuhan, the company and Dongfeng Motor signed a strategic cooperation agreement covering ultrafast charging and battery-swapping technology and systems, as well as vehicle energy supply, overseas markets and brand marketing, according to Dongfeng.
That deal came two days after CATL's October 22 strategic agreement with the BAIC Group, which spans vehicle development, battery supplies, the build-out of a swapping network and battery services. The partners are targeting one million vehicles compatible with the swapping technology.
Heavy trucks are getting attention too. CATL unveiled its Tianxing II battery platform on October 20, and Reuters reports the company plans to have 900 battery-swapping stations for trucks operating in China by the end of the year, rising to 2,000 by 2027.
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There was also movement on next-generation chemistry. Speaking on the Shenzhen Stock Exchange's investor platform on Tuesday, CATL reaffirmed its target of small-series production of solid-state batteries in 2027, with research and development on fully solid cells continuing. Separately, a sodium-ion energy storage agreement will see up to 3 GWh of capacity deployed in Europe over five years — a letter of intent covering the European energy storage market, according to the company.
Indonesia Plant Starts Up
Outside China, the joint Indonesian battery plant operated by CATL and Antam has begun production, news agency Antara reported on Thursday. Indonesia's coordinating minister said President Prabowo is expected to officiate at the inauguration soon.
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