Morgan Stanley: CATL's acquisition of ZHONHEN's equity expands AI power supply capabilities, rating "In line with the market"

Morgan Stanley published a research report stating that CATL (03750.HK) announced the acquisition of a 17.4% stake in ZHONHEN (002364.SZ) for RMB 4.1 billion, marking the company's transformation from an indirect supplier of energy storage batteries to a direct provider of power solutions for data centers, deepening its involvement in AI power infrastructure.

The firm indicated that ZHONHEN focuses on power electronics technology, with business covering energy solutions for data centers (high-voltage direct current power systems), new energy vehicle charging infrastructure, and smart grids and industrial power. The firm believes that this acquisition strengthens CATL's upstream and downstream integration capabilities in grid connectivity and smart energy systems, which are key to addressing the power demands driven by data centers and AI. By enhancing transmission, system integration, and digital energy management capabilities, CATL can directly connect with end users such as hyperscale data centers and AI operators.

The firm maintains a "Buy" rating on CATL (300750.SZ) A shares, with a target price of RMB 530; the H shares rating is "In line with the market," with a target price of HKD 655