CATL is the global standard-setter for EV and energy-storage battery systems. Headquartered in Ningde, China, the company supplies more than one-third of the global EV and energy-storage battery market and has maintained this leadership for eight consecutive years. Its products power over 17 million vehicles and more than 1,700 grid-scale storage installations worldwide.
Secular Growth
Global demand for electrification is expanding at a rapid pace. Electric vehicles now represent over 20% of new car sales worldwide, while grid-scale energy storage is becoming a critical component of renewable integration and power reliability. China alone targets approximately 180 GW of storage capacity by 2027—twice its current level, and more than any other country globally. The combination of policy momentum and improving battery economics presents a favourable environment for growth in both mobility and storage applications.
Founder’s Arc
CATL was founded in 2011 by Robin Zeng, following his earlier success with ATL, a supplier of lithium batteries for consumer electronics (iPods). Zeng quickly secured BMW as a flagship customer and scaled into the leading EV cell supplier worldwide by 2017. Zeng’s innate ability to ‘skate where the puck is going to be, not where it has been’ has enabled CATL to outpace peers despite intense competition.
Innovation at Scale
CATL deploys the industry’s largest R&D budget by a margin. In addition, we believe CATL has one of the best ‘output per R&D $ spent’ versus its key competitors.
CATL’s R&D Spend Dwarfs Competitors*
Chinese peers include BYD Co + EVE Energy + Gotion + CALB. Korean peers include LGES + Samsung SDI + SK Innovation. *Assumed 95% of Samsung SDI’s R&D for batteries, 8% for SK Innovation, and 21% for BYD in line with each company’s revenue split.
The company has consistently translated laboratory innovation into scaled commercial battery deployments. CATL maintains leadership across multiple chemistry systems—LFP, NCM, M3P, sodium-ion, and condensed/solid-state. Its flagship products, Qilin and Shenxing, represent meaningful advances versus peers in both range and charging speed: Qilin achieved approximately 1,000 km on a single charge with superior volume utilisation, while Shenxing enabled around 520 km of range from a five-minute charge.
Manufacturing & Integration
CATL’s manufacturing base operates at “extreme” scale and precision. Smart-factory automation allows the production of millions of cells per day with defect rates measured in parts per billion. Vertical integration extends across raw-material procurement, component fabrication, and end-of-life recycling. This fusion of superior manufacturing and vertical integration offers quality consistency, cost stability, and supply security.
Powering Profits
CATL’s gross margins average ~26% versus ~19% for peers, revenue is projected to grow annually at ~23% through 2030 versus ~17% for peers and earnings are expected to grow by nearly 30% pa as energy-storage systems increase in mix and operating leverage improves.
Trading at 24× forward earnings with a PEG ratio of 0.8x, CATL offers unmatched exposure to the premiere battery player globally at a compelling valuation.
Disclaimer: Please note that these are the views of the writer and not necessarily the views of Ziller. This article does not take into account your investment objectives, particular needs or financial situation. Some small changes were made to this article, based on updated information.