Key takeaway

In 2025, the company shipped 363,300 tonnes of anodematerials, +61% YoY. Demand from power and energy storageremained strong. Full? year capacity utilization reached 108.5%,indicating production above designed capacity and full sales.

Among this, shipments in 4Q25/1Q26 are estimated at108,000/100,000 tonnes, with the main increment coming fromenergy storage products. The company’s average profit pertonne in 2025 is estimated at about RMB1500, down RMB400YoY. Among this, operating profit per tonne in 4Q25/1Q26 isestimated at RMB900/RMB700, down about RMB500/RMB200QoQ, mainly due to a higher proportion of outsourcedgraphitization and rising raw material prices. After new capacityis put into operation in 2H26, the outsourcing ratio is expectedto improve, and profitability is expected to recover further. Thecompany’s anode material shipments are expected to reach500,000/600,000 tonnes in 2026/2027, with earnings ofRMB770mn/RMB1.20bn.

Event

In 2025, the company recorded revenue/net profit attributableto shareholders of the parent company/net profit excludingnon-recurring items of RMB8.47bn/RMB470mn/RMB440mn,+52%/+55%/+27% YoY, slightly below the midpoint of priorguidance. Among this, 4Q25 recorded revenue/net profitattributable to shareholders of the parent company/net profitexcluding non-recurring items of

RMB2.56bn/RMB68mn/RMB26mn, +51%/-43%/-81% YoY and+12%/-47%/-80% QoQ. In 1Q26, the company recordedrevenue/net profit attributable to shareholders of the parentcompany/net profit excluding non-recurring items ofRMB2.27bn/RMB65mn/RMB62mn, +42%/-52%/-51% YoY and -11%/-5%/+137% QoQ.

Quick Take

Anode business: Strong energy storage demand but　　profitability remains under pressure

1） Sales volume: In 2025, the company shipped 363,300 tonnes of anode materials, +61% YoY. Demand frompower and energy storage remained strong. Full? year capacity utilization reached 108.5%, indicatingproduction above designed capacity and full sales. Among this, 4Q25 shipments are estimated at 108,000tonnes, +50% YoY and +9% QoQ. In 1Q26, anode product shipments are estimated at 100,000 tonnes, +49% YoYand -7% QoQ, remaining at a high level, with the main increment coming from energy storage products.

2） Profit: The company’s average profit per tonne in 2025 is estimated at about RMB1500, down RMB400 YoY.

Among this, operating profit per tonne in 4Q25 is estimated at RMB900, down about RMB500 QoQ, mainly dueto the rising proportion of outsourced graphitization. Profitability in 1Q26 remains under pressure, with profitper tonne estimated at about RMB700, due to rising raw material prices and a sustained high outsourcing ratio.

Other businesses: Magnetoelectric/EMS and other businesses are expected to contribute more than RMB50mnin total earnings in FY25, and more than RMB5mn in 1Q26.

Impairment loss: The company recorded asset impairment loss of -RMB3mn in 1Q26, +RMB25mn YoY and+RMB61mn QoQ, mainly due to reduced inventory write-down provisions.

Investment recommendation: It is expected that after new capacity comes online in 2H26, the outsourcingratio will improve and profitability will further recover. It is estimated that the company’s anode materialshipments will reach 500/600kt in 2026/27, with earnings of RMB770mn/RMB1.20bn. Based on the current shareprice, the corresponding PE is 15/9x.

Risks

1) Lower-than-expected production and sales of downstream new energy vehicles: Lower-than-expected salesdue to impacts like sluggish demand; lower-than-expected production due to sharp fluctuations in upstreamraw material prices, power cuts, etc., which will further affect the shipment and profitability the company'srelated business.

2) Raw material prices rising beyond expectations: Since 2021, raw material prices have continued to ri se. Highand volatile prices have had a certain impact on downstream demand, and have also created short-termdisturbances to the company’s earnings.

3) Slower-than-expected progress of the company's key projects: For the company as a participant in the newenergy sector, the progress of major projects is the key to supporting the revenue and profits, and is also areflection of the company's growth potential. The slower-than-expected progress of major projects will affect itscurrent and long-term performance.