Citi raised its price target on CALB to HKD40.9 from HKD33.4, implying 26.5% upside. The bank boosted fiscal 2026 and 2027 earnings forecasts by 7% and 34%, citing strong ESS and commercial EV battery demand. Shares surged 7.5% to HKD32.34.
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CALB surges 7.5% as Citi raises target price to HKD40.9
CALB (03931.HK) surged 7.5% to HKD32.34 after Citi raised its price target to HKD40.9, citing strong demand for energy storage and commercial electric vehicle batteries.
Citi raised its earnings forecasts for fiscal 2026 and 2027 by 7% and 34% to RMB2.835 billion and RMB4.817 billion, respectively, reflecting management guidance and higher battery sales assumptions, the bank said in a research report. The bank also introduced a fiscal 2028 earnings forecast of RMB8.053 billion.
The new target price implies about 26.5% upside from the current level and is based on a projected 22.2x fiscal 2026 price-to-earnings ratio, up from 20.6x previously. Citi maintained its Buy rating, with the valuation multiple in line with the global average for battery manufacturers.
Citi said CALB's battery capacity expansion, combined with strong demand for energy storage system batteries and commercial EV batteries, will support shipment growth through fiscal 2027. The upgrade comes after CALB announced its fiscal 2025 results, which prompted the bank to update its forecast model.
The stock opened 1.4% higher before accelerating gains, touching a session high of HKD32.54. Turnover reached HKD111 million on about 3.5 million shares traded. Short-selling data as of the prior session showed a ratio of 35.1%, indicating elevated bearish positioning that may have contributed to the sharp move higher as short sellers covered.
Among Chinese battery makers, CALB competes with Contemporary Amperex Technology Co. and BYD Co., which dominate the domestic market. Citi's upgrade highlights CALB as a beneficiary of the energy storage boom that is expanding the total addressable market beyond the passenger EV segment.
The broader Hong Kong-listed battery sector has drawn increased investor attention as China's energy storage deployment accelerates under government targets. CALB's focus on commercial EV and ESS applications differentiates it from peers more concentrated on passenger car batteries.
The upgrade shows Citi's conviction that CALB is capturing a growing share of the battery market beyond passenger electric vehicles. The raised forecasts for fiscal 2028 suggest the bank expects the growth trajectory to extend as energy storage demand accelerates. Investors will watch the company's first-half 2026 results for shipment growth tracking against the revised estimates.
This article is for informational purposes only and does not constitute investment advice.
