Just as Contemporary Amperex Technology Co., or CATL as it is known, jumped from relative obscurity to become the global battery leader after its 2018 trading debut in Shenzhen, CALB aims to use a Hong Kong listing to rapidly accelerate its own growth.
SVolt Energy Technology, a spinoff of carmaker Great Wall Motor and another rising giant of ChinaтАЩs EV supply chains, is meanwhile studying a listing on ShanghaiтАЩs Nasdaq-like Star Board, Chairman Yang Hongxin said last year. ┬а
Investors have shown theyтАЩre ready to back ChinaтАЩs battery industry. CATL has surged more than 1,800% since its listing, and currently has a market valuation of more than $181 billion, ranking it ahead of auto sector leaders including VW, Ford and Mercedes-Benz. In its latest funding round in December, SVolt raised 6 billion yuan ($943 million).
CALB, a battery supplier to automakers including Guangzhou Automobile Group and Changan NEV, already ranks among the worldтАЩs top 10 by manufacturing capacity, according to BloombergNEF data. By early 2025, CALBтАЩs growth plans should catapult the company to the No. 2 position behind CATL, closely followed by Svolt, which has an agreement to supply Jeep maker Stellantis.
Jiangsu-based CALB is working with Huatai Securities on a planned listing thatтАЩs likely to happen in the coming months, people familiar with the details said last week. The IPO could be Hong KongтАЩs biggest in 2022.
ItтАЩll bring vast new attention to CALBтАЩs growth plans and cement chairwoman Liu JingyuтАЩs role as a key player in the industryтАЩs future. SheтАЩs already led a restructuring in the company thatтАЩs focusing sales on regular cars, rather than buses or other niche markets, and is spearheading a drive to add global research facilities, including in North America.
Still Dominant
CALB, with eight major production bases across China, aims to add 100 gigawatt hours of additional capacity in Guangzhou and Jiangmen, has a project to add production of 100,000 tons of lithium cathode materials a year, and signed an initial agreement to add a battery plant in Europe. It also returned to profit last year, according to its sales listing document.
The firmтАЩs rise will bring fresh scrutiny of CALBтАЩs ownership and government ties, however. The company was established in 2015 and emerged from state-owned conglomerate Aviation Industry Corp. of China, or AVIC, a supplier of defense equipment including to ChinaтАЩs military.
CALB currently counts entities controlled by the Jintan district government as its largest shareholder, according to a regulatory filing, but it has disposed of its stakes in a unit that engages in military industrial business after considering its potential impacts and risks.
Still, the efforts to add more capacity by both SVolt and CALB, along with huge expansions planned by CATL, are likely fuel more worries about the global EV sectorтАЩs reliance on Beijing.
U.S. Senators including Democrat Joe Manchin and Republicans Lisa Murkowski on Friday sent a letter to the Biden administration raising fresh concerns about the countryтАЩs dependence on China. Those qualms are likely to linger as the country’s big battery industry gets even bigger.
