On the last day of May, the first company with a market value of more than one trillion appeared on the A-share GEM. However, there is a slight difference from the past. This time, the company with a market value of one trillion is not liquor, nor is it a bank or insurance. It is a new energy company-CATL (300750.SZ).
According to its annual report, CATL is a lithium-ion battery provider focusing on the research and development, production and sales of power battery systems and energy storage systems for new energy vehicles. Its main products include power battery systems, energy storage systems and lithium battery materials.
As of May 31, there were a total of eight listed companies with a market capitalization of over one trillion yuan. Except for CATL, four of the other seven were banks, two were liquor companies, and one was an insurance company.
In China, liquor is more than just a drink. As a cultural carrier, like tea culture, it is a core component of Chinese traditional culture. China’s long-standing drinking tradition makes the liquor consumption market stable and large, so it is easy to appear. Leading enterprise in liquor.
At the same time, with the continuous rapid development of the domestic economy, a financial industry that matches the booming economy is also needed. Coupled with a large population base, the banking and insurance industries have also produced many giant companies.
The CATL’s entry into the trillion-dollar club shows that China’s capital market has begun to favor technology companies, and the market value weight structure of the domestic capital market may usher in changes. At the same time, the success of the CATL also indicates that China has already entered the new energy competition. Don’t let the wind fall.
New energy vehicles give birth to the birth of a trillion giant
In 1999, the current chairman of CATL, Zeng Yuqun, took the lead in establishing Amperex Technology Limited (ATL) in Hong Kong. At first, ATL focused on the production of lithium batteries in the consumer electronics field, mainly producing lithium batteries for consumer electronics such as mobile phones and notebooks. Soon after its establishment, it became a battery supplier for mobile phone giants Samsung and Apple.
In 2011, Zeng Yuqun started his business for the second time. Due to the development of new energy vehicles, Zeng Yuqun saw the huge business opportunities of power batteries and established the Ningde era, focusing on the research and development, production and sales of power battery systems and energy storage systems for new energy vehicles.
2011 is the year when new energy vehicles have gradually risen. According to the data of EV sales, in the decade from 2010 to 2020, electric vehicles have exploded.
New energy vehicles have emerged in 2011. Among them, plug-in hybrid electric vehicles (PHEV) and battery electric vehicles (BEV) have reached 3.24 million global sales in 2020. Among them, by region, China accounted for the largest proportion, reaching 1.337 million vehicles, accounting for 41.27% of the global new energy vehicle market.
Taking advantage of the wave of new energy vehicles, from 2018 to 2020, CATL will achieve operating income of 29.61 billion yuan, 45.79 billion yuan, and 50.32 billion yuan; the net profit attributable to the owners of the parent company will be 3.387 billion yuan, respectively. 4.56 billion yuan and 5.583 billion yuan. In the past three years, CATL’s performance has steadily improved.
In the first quarter of 2021, CATL’s performance continued to improve. The first quarter report showed that CATL achieved operating income of 19.17 billion yuan, an increase of 112.24% year-on-year; net profit attributable to owners of the parent company was 1.954 billion yuan, an increase of 163.38% year-on-year.
The continued improvement in performance is also reflected in the secondary market. As of the close of May 31, CATL’s closing price was 434.10 yuan, an increase of 5.98%, and the market value was 1.01 trillion, successfully breaking through one trillion, making it the first company to break through on the GEM. A trillion-dollar company is also the eighth A-share company with a market value of over one trillion.
The concept of carbon neutrality and carbon peaking is hot
The recent hot domestic concepts of carbon neutrality and carbon peaking also indicate that the development of new energy is the top priority of future economic development.
Carbon neutrality (carbon neutrality) is a term for energy saving and emission reduction. It refers to the total amount of greenhouse gas emissions produced by enterprises. It needs to offset its own carbon dioxide emissions by means of afforestation, energy saving and emission reduction, so as to achieve carbon dioxide emissions. “zero emission”.
The carbon peak refers to a decline in carbon emissions after rapid technological development and a plateau. Simply put, it means to “break-even” carbon dioxide emissions.
On September 22, 2020, when attending the United Nations Congress, the Chinese government proposed that China will increase energy conservation and emission reduction, adopt more favorable measures, and strive to reach the peak of carbon dioxide emissions by 2030, and at the same time strive to achieve carbon neutrality by 2060. .
On March 5, 2021, the State Council Government Work Report for 2021 pointed out that China will do a good job in carbon peaking and carbon neutrality, formulate an action plan for carbon emissions peaking by 2030, and optimize industrial structure and energy. structure.
Since the human industrial revolution, carbon dioxide produced by coal and oil as fuel has been the main cause of carbon emissions. According to the International Energy Agency (International Energy Agency, hereinafter referred to as IEA) in the 2020 edition of Energy Technology Outlook, technology is the top priority to avoid climate change, and achieving the new energy climate goal requires a significant increase in the development and application of renewable energy technologies.
According to IEA data, coal power generation accounts for the largest share of global carbon emissions, followed by steel, cement and other heavy industries, while the transportation industry also accounts for a larger share. The development of new energy vehicles and energy storage technology can greatly alleviate the pressure on carbon emissions caused by transportation.
Photovoltaic, sodium battery or a solution?
During the first industrial revolution, the British invented the steam engine and replaced manual labor with machines, which greatly enhanced Britain’s strength and achieved the hegemony of the British Empire.
The second industrial revolution brought mankind into the electrical age. Coal power and other traditional power generation modes and the pressure on carbon emissions from the petroleum industry have risen sharply.
Since electricity is the most important factor in generating carbon emissions, but due to the geographical constraints of new energy power generation methods such as hydropower and wind power, solar photovoltaic power generation has become a beachhead for a new round of energy development.
According to data from the IEA, despite a late start, China’s installed solar power generation capacity has developed rapidly in recent years, and photovoltaic power generation has grown rapidly.
In the past ten years, from upstream silicon wafers, modules, and photovoltaic power stations to downstream lithium batteries, energy storage, electric vehicles, and community energy storage stations, China’s photovoltaic development has achieved all-round development.
IEA also has high hopes for photovoltaic power generation. In its carbon emission reduction target, it stated that by 2050, 85% of buildings will achieve zero emissions; more than 90% of heavy industrial production will achieve low carbon; at least 70% of electricity will come from photovoltaics And wind power.
As for energy storage, China is not only satisfied with lithium batteries, but has begun to develop sodium batteries.
At the Ningde Times shareholders meeting on May 21, the chairman of Ningde Times, Zeng Yuqun, said that the sodium battery technology under study is mature and will be released around July this year.
Compared with lithium resources, sodium reserves are more abundant, and the richer reserves give the development of sodium batteries a cost advantage. Sodium ion batteries and lithium batteries have been developed for many years. Compared with lithium, sodium also has the disadvantages of instability and low battery life.
In the current energy storage power market, lithium still occupies a dominant position, but it is believed that with the development of technology, sodium batteries can become another darling of new energy storage.
postscript
CATL’s entry into the trillion-dollar club indicates that China’s capital market has begun to favor technology companies, and the market value structure of the domestic capital market may usher in changes. At the same time, the success of CATL also indicates that China is competing for new energy. The wind has not fallen.
Regarding the development of the new energy industry, China has gone from being a poor country to a world leader. Relying on photovoltaics and lithium, China will become the backbone of global carbon emission reduction.
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