Morgan Stanley gives CATL an "Overweight" rating as the sodium era arrives

Morgan Stanley published a research report indicating that CATL (03750.HK) is strategically shifting from lithium batteries to cost-effective sodium-ion batteries. The firm believes that the release of sodium-ion products marks the arrival of the "sodium era," especially considering its "release and mass production" model.

The report states that with CATL's launch of light truck power system solutions, sodium-ion batteries are becoming a promising alternative to lithium batteries. Although the current commercialization scale is still limited, the company is expected to achieve cost parity with lithium iron phosphate batteries in the short term. As supply chain capacity increases over the next three years, the firm anticipates that the rate of cost reduction will accelerate, with prices potentially being more than 30% lower than lithium iron phosphate batteries when capacity reaches 100GWh.

In terms of market penetration, sodium-ion batteries are expected to make progress first in light trucks and small (A0 class) and micro (A00 class) passenger vehicles. In addition to automotive applications, the report also sees significant potential for sodium-ion technology to replace lithium iron phosphate batteries in the energy storage system market. Morgan Stanley believes that these characteristics make sodium-ion batteries a viable and economical alternative to lithium iron phosphate batteries in various application scenarios. Morgan Stanley has given CATL (300750.SZ) a "buy" rating for its A shares, with a target price of 490 RMB