Electric Vehicle Battery Maker CATL Extends Market Leadership
Listed on the Shenzhen Stock Exchange in China, CATL (Contemporary Amperex Technology Co. Limited) has been a leader in the automotive electric battery research and production since the company was founded in 2011. CATL has been supplying to a suite of major automotive brands and is not stopping to expand to more clients as its leadership position solidified.
Since March this year, the stock price of CATL has doubled. Up to the closing of July 13, the three major A-share indexes closed up, the Shanghai index rose 1.44% and returned to 3400 points, and the ChiNext rose 3.99% to hit a new high in November 2015. Among them, the battery sector was active, and the CATL opened higher and higher. Once the intraday limit was closed, it fell back slightly but continued to close at the end, closing up 9.91%, to 224.11 yuan, and the market value is close to 500 billion yuan.
There has been news that CATL will provide power batteries for Tesla Shanghai super factory from this month. In the announcement released by CATL in February, the validity period of CATL’ supply to Tesla was from July 1, 2020 to June 30, 2022, and the purchase target was a lithium electronic power battery.
The OEMs that favor the business capabilities of the CATL are far more than Tesla. On July 10, CATL issued an announcement that Honda intends to participate in the subscription of its non-public offering of shares through its domestic subsidiary. The number of subscriptions accounts for about 1% of the total share capital after the non-public offering of shares, and will continue to hold at least Five years. CATL will also provide Honda with certain priority rights.
According to Soochow Securities’s calculation, the estimated total share capital after the local fixed increase is 2.429 billion yuan. If calculated at 1% of the subscription, Honda will purchase approximately 24 million shares of CATL , and the estimated capital contribution is 4 billion to 5 billion yuan.
It is reported that this is the second cooperation between Honda and the CATL. In February 2019, the two parties also signed an agreement that CATL will supply Honda automotive lithium-ion power batteries with an electric power of approximately 56GWh.
This time, the two parties still reached a continuation in commercial cooperation. CATL will supply the battery of the agreed type to Honda under certain business preferential conditions during the validity period of the agreement. The two parties will also jointly develop power batteries and develop future basic technologies. Cooperation is subject to the development cooperation agreement signed separately.
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