CITIC Securities: Energy Storage Growth to Drive Lithium Battery Sector to 25%-32% CAGR by 2027
CITIC Securities research indicates that the significant outperformance of the lithium battery sector since September 2025 is primarily driven by a surge in energy storage, leading to both increased volume and profitability. This trend is further strengthened by clear domestic energy storage capacity subsidies and rising international oil prices benefiting new energy sources. However, market expectations have begun to moderate since May, with international oil prices falling following the opening of the Strait of Hormuz. This has led to doubts about demand in the 2026-2027 period, creating a core conflict around future demand growth and supply-demand dynamics. CITIC Securities believes that overly pessimistic expectations for 2027 will be corrected between July and November. This correction will be supported by stabilizing lithium carbonate prices, confirmed energy storage tenders, and gradually confirmed 2027 orders and delivery guidance. These developments are expected to create opportunities for sector recovery.
The report highlights the interconnectedness of energy storage deployment, commodity prices, and the broader new energy sector. The analysis suggests that market sentiment, driven by geopolitical events impacting oil prices, can create short-term volatility in the lithium battery industry. The core challenge for investors and the industry lies in accurately forecasting long-term demand and supply dynamics amidst these fluctuating external factors. A shift in market expectations towards a more balanced view of 2027 demand, supported by concrete policy signals and order book confirmations, could lead to a sector re-rating. This situation underscores the importance of stable policy frameworks and transparent market signals in fostering sustained investment in critical energy transition technologies, mitigating the impact of speculative market movements.
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