Citi: Lowers target prices for CALB (03931) and Contemporary Amperex Technology (03750)

Citi released a research report stating that it has lowered the target prices for the H-shares of CALB (03931) and Contemporary Amperex Technology (03750), while maintaining a "Buy" rating on both. Among them, the target price for CALB was lowered from HK$40.9 to HK$33.1, the target price for Contemporary Amperex Technology's H-shares was lowered from HK$888 to HK$765, and the target price for Contemporary Amperex Technology's (300750.SZ) A-shares was lowered to RMB500. The bank believes that as battery capacity catches up with demand, the industry will enter a downturn cycle, but the overall utilization rate of the battery supply chain will remain stable, the supply-demand landscape will be relatively balanced, and conditions will not be as pessimistic as the market expects. The bank believes that future opportunities will be more focused on valuation and individual companies, and its cross-sector top picks include Contemporary Amperex Technology A-shares, CALB, Eve Energy Co.,Ltd., LG Energy Solution, Shenzhen Kedali Industry, Hunan Yuneng New Energy Battery Material, and Panasonic. The bank pointed out that the lowering of CALB's target price mainly reflects a reduction in the 2026 forecast P/E valuation multiple from 22.2x to the industry average of 18x. The lowering of Contemporary Amperex Technology's H-share target price is mainly due to the decline in the A-share target price, and is currently based on the company's historical average 2026 EV/EBITDA multiple of 15.7x, compared with 17.5x previously.