Institution: Optimistic about the battery sector's profit trend continuing upward throughout the year

Recently, Dongxing Securities released a strategy report on the lithium battery industry. The institution believes that after the lithium battery sector confirmed a turnaround in the third quarter of 2025, fundamentals across various segments have continued to recover. The upward trend in the lithium battery sector's prosperity is expected to persist, while the accelerated industrialization of new technologies is likely to provide sustained catalysts.

On one hand, the sector's rising prosperity presents opportunities for profit recovery and improvement across segments. On the other hand, the accelerated industrialization of sodium-ion batteries is expected to benefit core segments continuously. According to the analysis, the lithium battery sector's prosperity continues to rise, with demand maintaining an unexpectedly high growth trend, while supply-side expansion remains relatively rational. The supply-demand relationship in some segments is tightening marginally, with leading companies maintaining high utilization rates and profit margins already establishing an upward trend.

Dongxing Securities believes that in the battery industry, only leading companies are expanding supply, but the overall pace is moderate. With demand maintaining a high growth trend, the supply-demand pattern in the battery segment remains stable. As price negotiations among companies gradually materialize, battery prices are expected to rise further. The short-term impact of raw material price increases on profit margins is likely to be gradually eliminated in the second half of the year. The institution is optimistic about the continued upward trend in the battery segment's profit margins for the full year, while the sustained release of overseas demand is expected to boost profits for companies with advanced overseas deployment.

Additionally, sodium-ion batteries, leveraging advantages such as abundant resources, low cost, high safety, and strong low-temperature adaptability, are approaching an industrialization explosion phase. They show significant potential in multiple scenarios, including energy storage and low-speed vehicles. Core material and battery segments are expected to benefit continuously from the 0-to-1 volume ramp-up in demand.