ZENERGY (03677) Mid-Term Report Realizes Diverse Growth Expectations: Power Battery Installation Ranking Rises to Fifth, Energy Storage Business Expands by 8 Times

ZENERGY (03677) just disclosed its interim results for the fiscal year 2026, which deeply fulfilled the company's multifaceted growth expectations and fully demonstrated its strong growth momentum. In the first half of this year, ZENERGY seized the market opportunities arising from the structural iteration of power batteries and the rapid explosion of the energy storage industry. During this period, the company's revenue surged by 71.4% year-on-year to 5.438 billion yuan, taking its business scale to a new level. Notably, the revenue from energy storage battery business grew nearly eightfold year-on-year, historically exceeding 10% of total revenue and emerging as a strong second growth curve. At the same time, despite facing various external uncertainties such as increased fluctuations in upstream raw material prices, industry capacity differentiation, and escalating overseas trade barriers, all of ZENERGY's profitability indicators continued to exhibit resilient growth. During this period, the company's gross profit and net profit were 680 million yuan and 372 million yuan, representing year-on-year increases of 19.6% and 68.6%, respectively. With steady progress in the core power battery business and a strong breakthrough of the second growth curve, ZENERGY's interim report indicates that the company has already established a new pattern of dual-engine collaborative efforts, suggesting that ZENERGY's growth visibility in the next phase will only increase. Dual-engine collaboration opens a new growth landscape One of the most prominent value signals released by ZENERGY's latest financial report is its diversified business structure blooming in multiple areas. First, looking at the company's core layout, benefiting from the gradual release of new production capacity and a further increase in capacity utilization rate compared to the previous year, ZENERGY's power battery shipments reached 11.13 GWh in the first half of the year, a significant increase from the same period last year. Industry data shows that from January to June, ZENERGY has jumped from seventh place in 2025 to fifth place in the domestic installed capacity ranking for new energy passenger vehicles, with its market share continuing to rise. The significant volume increase in shipments has strongly driven the growth of ZENERGY's power battery business revenue, which reached 4.577 billion yuan in the first half of the year, a year-on-year increase of 53.3%. It is worth mentioning that while ZENERGY's power battery business steadily expands its influence in the domestic market, the company's performance in overseas markets is also improving. According to company sources, ZENERGY is engaging in indirect exports of batteries alongside complete vehicles and exporting in KD (knock-down) kit form. In the first half of the year, indirect export business revenue accounted for 14%. As the brightest growth area in this financial report, ZENERGY's revenue from energy storage and other businesses surged to 862 million yuan in the first half of the year, increasing its revenue share to 15.8%, representing an increase of nearly 10 percentage points compared to the same period last year. Among this, the energy storage battery business achieved revenue of 590 million yuan, accounting for more than 10% of total revenue, a nearly eightfold increase compared to the same period last year. Behind this impressive achievement is the company's long-term technical accumulation and product layout in the energy storage field. On one hand, the companys main mature product, the 314Ah standardized cell, has become a key supply product for household energy storage globally; on the other hand, with the gradual release of new production capacity, the shipment volume of energy storage products and business development have significantly improved year-on-year. Currently, ZENERGY is collaborating with leading integrators such as Ningbo Deye Technology Corporation and Toyota in the fields of household energy storage, commercial and industrial energy storage, and independent energy storage stations, while actively exploring business negotiations for cutting-edge application scenarios such as AIDC and long-duration energy storage. In the diversified landscape of ZENERGY's new business, sodium-ion batteries are also growing rapidly. In the first six months of this year, the company's polyanion-type sodium-ion battery business achieved sales revenue of 15.1 million yuan, a year-on-year increase of 276.6%, primarily exporting to the EU market, with its high discharge rate characteristics precisely matching AIDC, peak shaving, and other backup scenarios. As the scale expands rapidly, the quality of profits can also withstand scrutiny. In the first half of the year, the net profit was 372 million yuan, a year-on-year increase of 68.6%, and the operating net cash flow reached 640 million yuan, significantly improving year-on-year. In terms of gross margin, influenced by the temporary rise in upstream raw material prices and the ramp-up of new capacity, ZENERGY's overall gross margin experienced some fluctuations in the first half of the year. However, from GMTEight's perspective, the pressure on profits due to raw material price fluctuations is a common industry issue. As cost transmission along the industrial chain gradually comes into effect, these pressures are expected to ease; focusing on ZENERGY itself, as new production capacity reaches a stable production phase and scale effects continue to release, ZENERGY's profitability is expected to gradually recover and ultimately reach new heights. Multi-dimensional layout enhances long-term growth momentum If the performance in the first half of the year is a direct test of the company's strategic execution capabilities, then examining its future layout allows for a clearer view of the sustainability of ZENERGY's growth momentum. In the field of power batteries, ZENERGY's competitive edge is built on two unique genes. First, the company is among the few manufacturers in the top ten battery companies that possess automotive parts genetics, with core management deeply understanding the balance between safety, quality, performance, and cost. Second, ZENERGY is the first power battery company in China to obtain both AS9100D aerospace quality management system certification and airworthiness certification from the Civil Aviation Administration of China, with its aviation battery products already achieving batch deliveries. This standard of quality, characterized by "aviation-grade safety and automotive-grade application," continues to customer trust and is ultimately reflected in the company's expanding market influence. The depth and breadth of customer expansion continue to increase. The company's supply share for core models at leading automakers such as FAW Hongqi, GAC Trumpchi, LEAPMOTOR, SAIC Zhiji, SAIC General Motors Wuling, SAIC General Motors, GAC Toyota, and Volkswagen continues to rise. Meanwhile, the overseas market is becoming a new source of growth. Through indirect battery exports alongside complete vehicles and KD kit overseas assembly, the company has sold products to markets in Hong Kong, India, Indonesia, and the EU. In the energy storage field, ZENERGY's layout is moving towards "multi-scenario penetration." The company has formed a complete product matrix covering multiple specifications from 100Ah to 2,700Ah+ and above for various scenarios such as household energy storage, commercial and industrial energy storage, independent energy storage stations, and AIDC energy storage. Moreover, ZENERGY is anchoring the trends of large-scale cell production and long-duration energy storage, proactively laying out a new product line compatible with the next generation of high-capacity cells. The company has completed trial production of samples for its 1,400Ah+ and 2,700Ah+ high-capacity cells in the first half of the year, and is currently undertaking performance and safety testing and verification, aiming to create competitive advantages for the next generation of products through extreme cost reductions. The ongoing release of production capacity at this stage provides ample reserves for ZENERGY's subsequent growth. Data shows that by the end of 2025, the companys total capacity will have increased to 35.5 GWh, with further increases expected by the end of this year. The pace of capacity expansion is highly aligned with robust customer orders, providing solid support for ZENERGY's next phase in meeting the sustained downstream demand for power batteries and energy storage with high-quality supply. Finally, revisiting ZENERGY's interim report, the company has delivered a result that further validates its strategic direction and execution efficiency against the backdrop of increased industry differentiation. With steadily rising market share in power batteries, strong performance in the energy storage business, and orderly expansion in overseas markets, this series of achievements points to ZENERGY's growth expectations progressively transforming into verifiable operational realities. With the collaborative efforts of the dual engines, it is anticipated that the visibility of ZENERGY's growth in the next phase will continue to increase, and its investment value will be released in tandem with the realization of its performance.