Net profit exceeds 630 million! Energy storage giant REPT BATTERO turns losses into gains

With the explosive growth in demand in the global energy storage market, the performance of related companies is beginning to materialize gradually. $REPT BATTERO(00666.HK)

With the support of demand, leading companies benefit directly.

In early February, the Hong Kong-listed energy storage company Replus Energy issued a positive trading update for 2025. The announcement shows that the company expects to achieve a net profit of 630 million to 730 million yuan for the year ending December 31, 2025, successfully turning a profit compared to a net loss of 1.353 billion yuan in the same period of 2024.

Regarding the turnaround in performance, Replus Energy stated the main reasons are:

First, the continuous increase in shipments of power and energy storage battery products has effectively driven steady revenue growth.

Second, the improvement in capacity utilization and the implementation of cost reduction and efficiency enhancement measures have significantly improved gross profit.

From a global perspective, the turnaround in Replus Energy's performance is mainly due to the growth in market demand. Relevant information shows that, as a core business unit under the Tsingshan Group, Replus Energy is mainly engaged in the design, R&D, production, and sales of power and energy storage lithium-ion battery cells, modules, packs, and system applications, providing high-quality solutions and services for global new energy vehicle power and smart power energy storage.

From the perspective of specific segments, Replus Energy mainly focuses on the new energy heavy-duty truck battery segment. Data from the Power Battery Application Branch Research Center shows that in 2025, China's new energy commercial vehicle battery installations experienced explosive growth, with new energy heavy-duty truck batteries accounting for 64% of the total commercial vehicle installations with 94.8 GWh.

The data also shows that the total new energy commercial vehicle battery installations in the market in 2025 were 148.6 GWh, with CATL ranking first with 96.2 GWh, and Replus Energy ranking sixth with 5.7 GWh.

Looking at the entire market, the power battery sector has always been dominated by CATL and BYD, which firmly occupy the first tier, with CATL leading significantly. Second-tier power battery manufacturers have consistently faced a relatively awkward situation, making capacity expansion a necessary option.

It is worth noting that although capacity is expanding, the advantage compared to absolute leaders like CATL is not obvious. Therefore, in a fiercely competitive industry, how power battery and energy storage companies cross the breakeven line becomes paramount.

From the perspective of revenue structure, as of the end of June 2025, the revenue from Replus Energy's power battery product segment was 4.027 billion yuan, accounting for 42.42% of its total revenue; the revenue from the energy storage battery product segment was 5.083 billion yuan, accounting for 53.55% of its total revenue. In other words, the energy storage segment, especially the residential storage segment, has a relatively clear advantage. Its heavy-duty truck battery segment ranks second nationally, but the moat is not deep, making it vulnerable to impact from giants like CATL.

From Replus Energy's overall strategy, it has effectively avoided the passenger vehicle battery segment, choosing to compete differently in the heavy-duty truck battery and energy storage segments. Of course, this does not mean the company can rest easy. The price war in the lithium battery industry is not yet completely over, and industry gross profit margins are under significant pressure. More importantly, for first and second-tier battery companies, expansion in the energy storage and heavy-duty truck battery segments is relatively easy. Therefore, crossing the breakeven line does not guarantee absolute safety in the future.

So, does this mean the industry will continue to face pressure in the coming years?

Kan Jian Finance believes that the previous boom in the new energy industry, the expansion of leading companies, and the cross-border entry of some companies led to rapid saturation of demand and overcapacity in the lithium battery industry. After going through this cycle, during the process of capacity rationalization, more mid-tier companies have realized that a herd-following business model is not viable. Therefore, industry concentration will further increase in the future, which actually benefits the performance realization of leading companies.

After entering 2025, the explosion in energy storage demand has led to continuous market expansion in the lithium battery industry, partially alleviating competitive pressure. However, overall, the rationalization speed of mid-tier companies will also accelerate. During the process of performance realization, gross profit margin levels will be maintained at a reasonable level, which will help the industry develop more steadily in the future. For Replus Energy, it needs to continuously monitor the realization of its performance.

After its performance forecast was released, Bank of Communications International issued a research report stating that the company has entered a profit growth channel through economies of scale and integrated transformation. It is expected that net profit in 2026 may further increase, but attention should be paid to raw material cost fluctuations and industry competition risks. Therefore, it maintains a "Buy" rating on Replus Energy with a target price of HKD 15.46.