Zhongjin: Guoxuan High-Tech is expected to reach a turning point of profitability on a large scale, maintaining an "outperform" rating in the industry.

The research report of Zhongjin Company pointed out that Guoxuan High-tech stated at the technology conference that its all-solid-state battery, Jinshi battery product has made significant progress in industrialization, with an energy density of the battery cell reaching 350Wh/kg and the system energy density reaching 280Wh/kg. The solid-state battery product has started road tests. In terms of production capacity construction, the company's first trial production line for all-solid-state batteries has been completed, with a designed capacity of 0.2GWh/year. The production line is independently designed by the company, with a domestication rate of 100% for core equipment, and a yield rate of over 90% on the production line. Samples of quasi-solid-state battery products have been sent out. The company stated that the energy density of the GY quasi-solid-state battery system can reach 235 Wh/kg or more, exceeding 36% compared to liquid-state batteries of the same volume. The main future application scenarios include eVTOL, new energy vehicles, and humanoid robots. In addition, the company's newly released products like the Qicheng 2nd generation/heavy-duty truck standard box/20Mwh energy storage system are based on mature materials and production processes. It is estimated that these products may achieve mass shipments starting from 2H25, which is expected to bring positive contributions to the company's profitability. It is judged that as the company's battery shipment volume rapidly increases, the enhanced economies of scale have the potential to gradually offset the limitations on the company's profitability caused by cost rates/debt impairments. It is believed that if the company's battery shipment volume reaches 50-60GWh in 2H25, the company may reach a turning point towards profitable scalability. The "outperform the industry" rating and a target price of 27 yuan are maintained.