In-Depth Analysis of the Investment Logic Behind CATL's Strategic Stake in Fulin Seiko

Based on the collected information, I will provide you with an in-depth analysis report on the investment logic behind CATL’s strategic stake in Fulin Seiko.

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On the evening of January 13, 2026, Fulin Seiko (300432.SZ) issued an announcement stating its plan to introduce CATL as a strategic investor via private placement of shares. CATL will subscribe for

at a price of , with a total investment of . After the transaction is completed, its shareholding ratio is expected to exceed [1][2][3].

The funds raised in this offering will be mainly used for the following projects:

• Annual 500,000 metric tons of high-end lithium iron phosphate for energy storage project
• Key components project for electric drive systems of new energy vehicles
• Robot integrated electric joint project
• Key components project for intelligent chassis wire control systems
• Key components project for power systems of low-altitude aircraft

Meanwhile, the two parties signed a “Strategic Cooperation Agreement”, stipulating that

[1][2][4].

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After experiencing

, the lithium iron phosphate industry is entering a cyclical recovery. According to data from the China Chemical and Physical Power Sources Industry Association, the average , and industry reshuffling is intensifying[5][6].

From the end of 2025 to the beginning of 2026, multiple positive signals have emerged in the industry:

• Leading manufacturers (Hunan Yuneng, Wanrun New Energy, Anda Technology, etc.) have collectively suspended production for maintenance, with an obvious intention to support prices[6]
• The price of lithium iron phosphate materials has risen from less than
  RMB 40,000 per metric ton
  in November 2025 to
  more than RMB 50,000 per metric ton
  in January 2026[1]
• Negotiations on processing fee increases have basically been completed, with a general acceptance of an increase of approximately
  RMB 1,000 per metric ton
  [6]

has become the focus of the market. According to CITIC Securities’ forecast:

• From January to November 2025, China’s lithium iron phosphate production reached
  3.48 million metric tons
  , a year-on-year increase of
  57.9%
  [1]
• In 2026, high-end (fourth-generation) products will still be in a
  state of structural shortage
  , with an estimated annual demand of approximately
  1.5 million metric tons
  , while actual supply is only
  1-1.2 million metric tons
  [1][7]

This technological upgrade direction is highly aligned with the product iteration of CATL’s Shenxing Battery and Qilin Battery. In 2024, these two batteries together accounted for

of CATL’s power battery sales, and the proportion is expected to rise to in 2025[7].

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Fulin Seiko was founded in 1997 and listed on the Growth Enterprise Market of the Shenzhen Stock Exchange in March 2015. Its main businesses include:

• Automotive engine components
  (traditional competitive business)
• Intelligent electronic control systems for new energy vehicles
• Precision gear shafts and robot electric joints
• Lithium iron phosphate, a cathode material for new energy lithium batteries
  (core growth driver)[2][8]

The company operates its lithium battery cathode material business through its subsidiary

As of 2025, Fulin Seiko has consecutively won CATL’s [4].

Fulin Seiko uses the

to produce lithium iron phosphate. Compared with the mainstream iron phosphate method, it has the following advantages:

• The product has
  higher compaction density
  , which is a key raw material for manufacturing high-energy-density lithium iron phosphate batteries[3]
• It is more suitable for the application needs of fast-charging power batteries and large-capacity energy storage batteries[1]

The company currently has an annual production capacity of

of high compaction density lithium iron phosphate and is continuing to expand production[3].

Indicator	Data
Total Market Capitalization	RMB 34.98 billion
Total Revenue (TTM)	RMB 9.085 billion (YoY +54.43%)
Net Profit	RMB 325.1 million (YoY +4.63%)
Gross Profit Margin	11.23%
Liability Ratio	63.65%

Jiangxi Shenghua, the subsidiary, achieved a net profit of

in the first half of 2025, successfully turning losses into profits[3].

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CATL has launched a “combination of moves” this time, signing lithium iron phosphate supply agreements totaling

with Ronbay Technology (3.05 million metric tons over 5 years) and Fulin Seiko (3 million metric tons over 3 years) within one day[1][2].

Industry analysis points out that by locking in upstream resources, CATL is expected to

, building a cost moat in the current fierce price competition[2].

CATL has built a lithium iron phosphate supply network covering multiple technical routes and regions:

Supplier	Supply Volume	Cooperation Model
Hunan Yuneng	Approximately 500,000 metric tons/year	Equity binding (shareholding of nearly 10%)
Fulin Seiko	1 million metric tons/year	Strategic stake + long-term agreement
Ronbay Technology	610,000 metric tons/year	Long-term agreement (RMB 120 billion)
Wanrun New Energy	265,000 metric tons/year	Long-term agreement (2025-2030)
Dynanonic	-	Joint venture factory
Longpan Technology	157,500 metric tons/year	Overseas base cooperation

Overall, the locked-in lithium iron phosphate supply volume of CATL has reached

, which can support an annual battery production of approximately [3][5].

For the investment in Fulin Seiko, CATL not only obtains financial returns, but more importantly:

1. Technological Synergy
   : Jointly develop a new generation of higher compaction density lithium iron phosphate materials[4]
2. Capacity Guarantee
   : Lock in the supply of high-end products to support its own battery technology iteration[4]
3. Layout in Emerging Fields
   : The scope of cooperation extends to cutting-edge fields such as robots, intelligent chassis, and low-altitude aircraft[2][4]

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Lithium iron phosphate cathode materials ← Fulin Seiko (CATL holds a stake in Jiangxi Shenghua)
        ↓
    Power/energy storage batteries ← CATL
        ↓
    New energy vehicles/energy storage systems

Through capital ties, CATL has achieved deep binding with core cathode material suppliers, ensuring supply chain stability and product quality consistency[4].

The cooperation between the two parties is not limited to lithium iron phosphate materials, but also involves:

• Electric drive systems for new energy vehicles
  : Fulin Seiko already has R&D and production capabilities for intelligent electronic control systems
• Key robot components
  : Fulin Seiko cooperates with ZhiYuan Robotics to provide precision reducers and intelligent electric joints for robots[2]
• Intelligent chassis wire control systems
  : Aligning with the development trend of intelligent driving
• Power systems for low-altitude aircraft
  : Forward-looking layout in emerging markets[2]

Fulin Seiko has become a supplier of key robot components. In August 2025, it reached a project cooperation worth tens of millions of RMB with ZhiYuan Robotics, and nearly 100 humanoid robots have been deployed in Fulin Seiko’s factories[2]. CATL also has an in-depth layout in the robot track, having invested in enterprises such as Qianxun Intelligent, Zhongqing Robotics, Galaxy General, and Vita Power[2]. The cooperation between the two parties in the robot field can form an industrial effect of

.

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After two years of decline, lithium iron phosphate prices are at the bottom of the cycle. CATL’s large-scale supply locking at this time takes into account both

and [3][6].

High compaction density lithium iron phosphate has high technical barriers, and only a few enterprises can achieve stable mass production. Fulin Seiko’s technological advantages in the ferrous oxalate process make it a

for CATL’s high-end product supply[1][3].

Through the dual means of “order binding + capital ties”, CATL has further consolidated its

in the industrial chain, forming a from resources to high-end materials[1][3][5].

The extension of cooperation to fields such as robots, intelligent chassis, and low-altitude aircraft reflects the strategic consensus of both parties on the

, reserving space for long-term growth[2][4].

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1. Approval Risk
   : This offering is still subject to shareholder meeting review, Shenzhen Stock Exchange approval, and CSRC registration[4]
2. Performance Risk
   : The lithium iron phosphate industry continues to expand production, and may face pressure from overcapacity[5][6]
3. Price Fluctuation Risk
   : Fluctuations in raw material prices and terminal product prices may affect profitability[6]
4. Technological Iteration Risk
   : The development of technical routes such as all-solid-state batteries and sodium-ion batteries may change the competitive landscape[3]

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[1] Gasgoo - “CATL Launches a ‘Combination of Moves’” (https://m.gasgoo.com/news/70442690.html)

[2] Sina Finance - “Over RMB 3.1 Billion! CATL Plans to Take a Strategic Stake in This Key Robot Component Supplier” (https://finance.sina.com.cn/roll/2026-01-14/doc-inhhhnwp8305338.shtml)

[3] Caijing Magazine - “CATL Increases Purchases of Lithium Iron Phosphate, ‘CATL Chain’ Enterprises Sign Huge Orders” (http://yuanchuang.caijing.com.cn/2026/0114/5136621.shtml)

[4] Shanghai Securities News - “Fulin Seiko: Announcement on Signing the ‘Strategic Cooperation Agreement’” (https://paper.cnstock.com/html/2026-01/14/content_2169573.htm)

[5] Futu News - “Under the Wave of Over 4.1 Million Metric Tons of Capacity Expansion: Overcapacity, Frenzy, and ‘Fragmentation’ of Lithium Iron Phosphate” (https://news.futunn.com/post/67635573)

[6] EET China - “Energy Storage Becomes a New Growth Point, Lithium Iron Phosphate Price Hike Wave Will Continue Until 2026” (https://www.eet-china.com/news/202512163871.html)

[7] Eastmoney - “Four Key Focuses of the Lithium Battery Industry in 2026” (https://pdf.dfcfw.com/pdf/H3_AP202512311811875727_1.pdf)

[8] Eastmoney.com - “Fulin Seiko (300432) Company Profile” (http://quote.eastmoney.com/sz300432.html)