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Investing.com - JPMorgan has downgraded Contemporary Amperex Technology Co Ltd (HK:3750) from Overweight to Neutral while raising its price target to HK$415.00 from HK$400.00.
The rating change follows CATL’s second-quarter results, which showed approximately 150 gigawatt-hours in sales volume and net profit of RMB16.5 billion, exceeding JPMorgan’s estimates of 140-150 gigawatt-hours and RMB15.5-16.0 billion.
JPMorgan noted that the earnings beat was likely already anticipated by the market, as CATL’s Hong Kong shares had risen 24% and its A-shares increased 10% in the nine trading days before some profit-taking on July 30.
The investment bank raised its earnings forecast for CATL by 5% to reflect the stronger results, while maintaining the same target multiples of 20x 2026-27 price-to-earnings ratio for both the Hong Kong and A-shares.
JPMorgan described the downgrade as "purely a valuation call," noting that CATL’s Hong Kong shares now trade at more than a 40% premium over its A-shares and have rallied 62% since IPO, compared to an 8% rise in the Hang Seng Index and a 7% increase in CATL’s A-shares.
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