Citi has released a research report updating its price targets for Contemporary Amperex Technology Co.,Ltd. (CATL).
The bank has raised its target price for the A-shares from 576 Chinese yuan to 603 yuan.
For the H-shares, Citi has increased the target price from HK$621 to HK$888.
This new H-share target is based on applying a 28% historical H/A-share premium, reflecting the stock's scarcity in offshore markets as the global battery leader.
The firm maintains its "Buy" rating on the stock and continues to list it as a "Top Pick" within the sector.
The new HK$888 target implies a valuation of 34.3 times the estimated price-to-earnings ratio and 8.7 times the price-to-book ratio for the 2026 fiscal year.
Updated Financial Forecasts
Following the release of CATL's first-quarter results, the bank has updated its financial model.
Profit forecasts for the 2026 to 2028 fiscal years have been raised by 9%, 9%, and 7% respectively.
The new forecasts are 1.03 trillion yuan for 2026, 1.26 trillion yuan for 2027, and 1.49 trillion yuan for 2028.
Volume Outlook and Market Dynamics
Despite a slight reduction in the forecast for unit gross margin, the bank has increased its battery sales volume projections.
It anticipates CATL's battery production and sales will reach significant milestones of 1.2 terawatt-hours and 1.0 terawatt-hours respectively in the 2026 fiscal year.
This represents year-on-year growth of 61% and 54%.
Even from a higher base, Citi expects strong battery production and shipments to continue in the second half of the year, with demand for energy storage systems being a particular highlight.
The report also notes that, in the near term, lithium carbonate prices remaining above 200,000 yuan per tonne will not destroy demand.
Instead, higher lithium prices are seen as evidence of solid underlying demand.
For the second quarter of the 2026 fiscal year, Citi forecasts the company's net profit will reach 24.3 billion yuan.
This is based on expected battery sales of 260 gigawatt-hours, representing year-on-year growth of 77% and a sequential increase of 29%.