The company announced that its board has approved the establishment of a new wholly owned subsidiary with a registered capital of 30 billion yuan ($4.4 billion), according to a statement released Wednesday, News.Az reports, citing Bloomberg.
The new business will focus on mineral resource exploration, metals processing, and the sale of chemical products. Following the announcement, CATL shares rose by as much as 10.3% in early trading in Hong Kong and up to 6.7% in Shenzhen.
According to the company, the new unit will serve as an investment and operations platform for its activities in the new-energy mining sector. It will integrate CATL’s existing mining-related assets and actively pursue both domestic and international resource projects aligned with battery demand.
Battery manufacturers have been facing rising costs and supply uncertainties for raw materials such as lithium, whose prices have surged more than 140% over the past year. At the same time, CATL has been advancing sodium-ion battery technology for electric vehicles as a potential alternative to conventional lithium-ion systems.
Recent reporting by Bloomberg News indicated that CATL has engaged the founder and former chairman of Zijin Mining Group Co. Ltd. as an advisor for its expanding mining operations, according to sources familiar with the matter.
Geopolitical tensions and concerns over resource availability continue to challenge the battery supply chain. Nickel prices on the London Metal Exchange are near their highest levels since 2024, partly due to reduced ore output from Indonesia, a major producer. Meanwhile, benchmark cobalt prices have more than doubled following export restrictions imposed by the Democratic Republic of the Congo, one of the world’s leading cobalt suppliers.
CATL operates a lepidolite mine in China’s Jiangxi province, although it has been inactive since August. The company noted that it has gradually increased its exposure to upstream materials, including lithium, nickel, and phosphorus.
More broadly, CATL remains a central player in the rapid expansion of large-scale energy storage, driven by growing demand from power grids and data centers. The company could also benefit from global efforts to electrify energy systems, particularly following the significant fuel market disruptions triggered by the war in Iran.
In financial results released separately on Wednesday, CATL reported a 49% year-on-year increase in net income for the first quarter, reaching 20.7 billion yuan and surpassing analyst forecasts. Revenue rose to 129 billion yuan, marking a 52% increase compared to the same period last year. These figures build on a 42% rise in annual profit recorded previously.
Battery sales during the first quarter exceeded 200 gigawatt-hours, representing annual growth of more than 60%, according to a transcript of the company’s earnings call with analysts.
During the call, CATL stated that its energy storage segment accounted for approximately 25% of total sales, reflecting a notable increase compared to earlier periods.
The company also emphasized that geopolitical disruptions, including tensions in the Middle East, are likely to accelerate the global transition to renewable energy over the long term.
In the short term, however, uncertainty surrounding crude oil supply and prices is expected to rise, which may encourage consumers to shift toward electrified products, CATL added.
