CITIC Securities reports China’s lithium battery supply chain rebounded in H1 2025, driven by NEV sales and energy storage demand. Capex and capacity expansion resumed, profitability improved across batteries and materials, while tech upgrades like solid-state and fast-charging support long-term global competitiveness for leading companies.

Lithium Battery Industry Gains Momentum as Leading Players Strengthen Competitive Edge

On September 9, CITIC Securities released a research report analyzing the performance of the battery and energy management supply chain in the first half and second quarter of 2025. The key takeaways are as follows:

1. Demand Side: Growth Driven by Synergistic Forces, Revenue Returns to Positive Trajectory

Supported by steady growth in domestic and overseas new energy vehicle (NEV) sales and booming global energy storage demand, supply chain shipments were strong. In most segments, second-quarter revenues successfully returned to year-on-year growth, signaling a clear recovery on the demand side.

2. Supply Side: Capital Expenditure Rebounds, Expansion Underway in Tight Segments

Industry capex has largely bottomed out, with the combined growth rate of “fixed assets + construction in progress” showing a slight rebound in Q2—evidence of improving investment confidence. Notably, capacity expansion has already begun in certain supply-constrained segments, laying the foundation for future capacity release and stable market supply.

3. Profitability: Improvement Across Multiple Segments, Technology Upgrades Unlock Upside

Key segments such as batteries and anodes delivered robust profitability with both year-on-year and sequential improvements. Materials profitability appears to have bottomed out, while downstream technology upgrades (e.g., solid-state batteries, fast-charging technologies) are stimulating demand for high-end products. This is expected to usher materials into a margin recovery cycle.

4. Long-Term Outlook: Global Advantage Reinforced, Leading Companies Poised to Widen Lead

China’s lithium battery supply chain continues to hold a significant global competitive advantage, while overseas expansion further strengthens this position. Leading players, leveraging breakthroughs in innovation and strategic overseas presence, are set to consolidate their dual advantages in both market share and profitability.

CITIC Securities maintains a positive long-term view on industry leaders that have proven resilient across cycles and continue to enhance their strengths in R&D, cost efficiency, and earnings stability. Their long-term growth potential warrants close attention.

Source：China-Mcc.com