Shares of world’s biggest EV battery maker soar 44pc

SHENZHEN: Shares of the world’s biggest maker of electric-vehicle (EV) batteries jumped on their trading debut as investors bet on rising demand for new-energy cars worldwide.

Contemporary Amperex Technology Ltd (CATL) rose by the maximum 44 per cent to 36.20 yuan (RM22.55) at 10.17am, here, valuing the company at about US$12.3 billion (RM49.1 billion).

The manufacturer sold a 10 per cent stake at 25.14 yuan a share in its initial public offering (IPO) on May 30. Investors are confident that CATL can fend off rivals including Panasonic Corp and continue to win orders as carmakers move towards EV.

CATL, whose customers include Volkswagen AG, had reduced the size of its IPO by more than half, compared with its original ambitions, because of declin- ing margins and a cap imposed by Chinese authorities on priceearnings ratios in IPOs.

CATL, which also counts carmakers Nissan Motor Co, Hyundai Motor Co and BMW AG as clients, last year overtook Panasonic as the world’s largest supplier of EV batteries by sales, thanks to increasing domestic demand.

Still, CATL’s gross margin shrank 9.5 percentage points last year to 35 per cent.

The company lowered battery prices to gain market share after the government reduced EV subsidies, weighing on profitability, said founder Zeng Yuqun last month.

CATL has said it will use the proceeds to help finance a new 24 gigawatt-hour factory at its home base of Ningde, Fujian province, and to develop next-generation battery technologies.