10-minute straight limit-up! Seven major positive news hits all at once! The entire sector is being "driven higher"!

The market rotation is very fast!

This morning (March 26), it was time for lithium batteries to surge. Lithium battery concept stocks experienced a sharp rise, with Dazhongnan sealing the board straight within 10 minutes of opening. Rongjie shares hit the daily limit, marking a three-day winning streak, Haike Xinyuan surged 20% to the limit, and companies like Huasheng Lithium Battery, Zhongyi Technology, Zhongrui Shares, and Shida Shenghua all saw significant explosions.

Analysts pointed out that the strong fundamentals of lithium batteries continue to support the ongoing heat, with expectations for both demand and prices to accelerate upward in April and May. There are seven favorable logic points supporting the strength of the entire sector.

Lithium Batteries Explode Across the Board

On March 26, lithium carbonate futures suddenly surged, leading to a corresponding explosion in lithium battery concept stocks. The battery ETF once soared over 2.5%.

On the evening of March 23, news broke about the escalation of Zimbabwe’s ban on the export of lithium concentrates. Although the Zimbabwean government had previously planned to fully ban concentrate exports by 2027, it suddenly announced an indefinite suspension of all ore and lithium concentrate exports at the end of February, and the situation has continued to escalate. According to local authoritative media reports, this ban has caused local small and medium-sized mining companies to fall into cash flow crises.

Zimbabwe plays an important role in the global lithium resource supply. Data shows that by 2025, Zimbabwe’s lithium resource production is expected to account for about 10% of the world’s total lithium resource output. Nearly all of Zimbabwe’s lithium ore and lithium concentrates are exported to China. In 2025, China’s total import volume of spodumene is expected to be 6.209 million tons, with 1.191 million tons imported from Zimbabwe, accounting for 19.2%, equivalent to about 110,000 tons of lithium carbonate equivalent.

Due to a previous systemic market sell-off, the entire lithium battery sector had no funding for speculation. However, in the past two trading days, as the market warmed up, more funds have been attracted. As the weekend approaches, the overall market atmosphere may turn cautious again. The speculative funds in the lithium battery sector may also bring a siphon effect.

Seven Favorable Factors Arrive

Zheshang Securities believes that in this cycle: on the demand side, energy storage battery demand exceeds expectations, and commercial vehicles are expected to continue to release demand for power batteries; on the supply side, upstream material capacity is clearing, the competitive environment is gradually improving, and prices are expected to rebound.

From the summary of market professionals, there are currently and in the future mainly seven favorable factors:

First, domestic automobile sales have dropped 26% year-on-year, but the “single vehicle battery capacity” has increased by over 20%, offsetting the impact of declining sales. The “single vehicle battery capacity” is the most fundamental technical indicator in the new energy vehicle industry, referring to the total electric energy that a vehicle’s power battery can store.

Second, export expectations have increased by 50%, but the actual growth may far exceed this expectation, fully compensating for the relatively weak domestic auto market.

Third, heavy trucks are already clearly expected to exceed expectations; the more diesel prices rise, the more significant the expectation becomes, as heavy trucks are all about commercial transport, with economy being their strongest attribute.

Fourth, analysts point out that the auto market will not be worse in April and May; new cars being launched + rising oil prices will benefit new energy, plus export expectations will also lead to a recovery in the auto market.

Fifth, lithium battery production in April and May is expected to increase month-on-month, with April showing growth that has not been seen in the past four years, and this is also under the expectation of rush orders in March, indicating very strong lithium demand.

Sixth, if the problems in Zimbabwe are not resolved, the arrival of ore at ports from April will decrease, and the price of lithium carbonate may rise or accelerate, with existing smelters already feeling the tension in ore supply.

Seventh, the demand for energy storage is increasing. The growth phase of energy storage has yet to be fully recognized. When stability is achieved, it is the time to increase positions.

Currently, the main narrative logic is still that under the backdrop of soaring oil prices, energy security has been widely emphasized. New energy (wind and solar storage) is becoming a necessary option for all countries. It is precisely under this context that lithium battery materials have witnessed an explosion following coal.

Dongcai Illustration · Adding Some Practical Insights

(Source: Securities Times Network)