CALB’s Gross Margin Increases to 10.3% in 2022

Image Source : China Visual

BEIJING, March 29 (TMTPOST) —— The total revenue of CALB was 20.375 billion yuan ($2.96 billion), with  year-on-year growth of 198.9% in 2022, and net profit was about 694 million yuan ($100.76 million), up 521.8% year on year, according to the 2022 financial results released by CALB on Tuesday evening.

Founded in 2015, CALB was originally a holding subsidiary of AVIC Lithium Power Battery (Luoyang) Co., LTD.   (AVIC Lithium Power) in Jiangsu Province. AVIC Lithium Power Battery Co., LTD., founded in 2009, is a well-established power battery company in China. It mainly produced lithium iron phosphate batteries for commercial vehicles. After a series of capital operations, CALB was separated from AVIC Lithium Power, and the two companies are under the same controlling shareholder.

CALB submitted an IPO application to the Hong Kong Stock Exchange in March 2022 and was listed in October. The company’s stock price fell below the issue price of HK $38 a share at the close of its first day of trading and stayed low ever since. CALB closed at HK $18.5 / share, up 0.65% on Tuesday.

According to the data of China Automotive Power Battery Industry Innovation Alliance, CALB ranked third among China’s power battery enterprises in 2022, with a market share of about 6.53%. CATL and BYD ranked the first and the second, with a market share of 48.2% and 23.45% respectively. According to South Korean market agency SNE Research, CALB ranked seventh among global power battery companies, with a 3.9% market share.

The company’s net profit growth outpaced revenue growth in 2022 thanks to higher sales and improved gross margins. The gross profit margin of CALB increased from 7.5% in 2021 to 10.3% in 2022. 

The company’s revenue mainly comes from domestic sources. According to the financial report, overseas markets accounted for only 1.9% of to total revenues in 2022. CALB is actively planning to expand its business in the European market. In November 2022, CALB announced that It would build a battery plant in Portugal with an annual capacity of about 15GWh, which is scheduled to be completed and put into operation in 2025.

Its major customers are GAC Group, Changan Automobile and XPENG Motors, according to a prospectus filed by CALB in March 2022. In 2021, sales revenue from these three companies accounted for 51.9 percent, 13.9 percent and 7.9 percent of the total, respectively.

The company did not disclose customer information for 2022. GAC Group and XPENG Motors were still its main customers, accounting for 39.6% and 17% respectively. While Changan accounted for less than 10 per cent of sales.

CATL sued CALB for infringement of five patents from August to October 2021, claiming a total of 185 million yuan ($26.86 million). The conflict between the two sides has not eased since then, but continued to escalate. In May 2022, CATL raised five patent infringement claims to 518 million yuan ($75.21 million). In August of the same year, CATL sued CALB for patent infringement, claiming 130 million yuan ($18.88 million). At the same time, CATL also sued CALB unfair competition.

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