Huaxi Securities: Sodium batteries are expected to effectively complement lithium batteries in addressing technical limitations

West China Securities points out that sodium batteries have evolved from an earlier stage driven by cost concerns due to high lithium carbonate prices to a phase characterized by technological maturity, a complete industrial chain, and clear application fields. They are expected to serve as an effective supplement to lithium batteries’ technical shortcomings.

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【West China Electric News】Sodium Battery Special Report: Technology Maturity + Clear Application Fields, Sodium Batteries Are Expected to Enter a Growth Phase

(1) Why Develop Sodium Batteries? An Effective Supplement to Lithium Battery Shortcomings

The working principle of sodium batteries is similar to that of lithium batteries, both being intercalation/deintercalation type batteries. However, differences in structure lead to performance variations. Compared to lithium batteries: 1) sodium batteries have good wide-temperature and low-temperature performance; 2) sodium resources are abundant; 3) sodium-ion batteries are safer; 4) sodium batteries have lower energy density than ternary and iron phosphate batteries; 5) sodium batteries have limited cycle life, among other key characteristics.

(2) Approaching Scale Production: What Has Sodium Battery Development Experienced?

By reviewing the development history of domestic sodium batteries, we believe that after years of exploring technology and processes, product stability, cost optimization, and application scenarios have become clearer. The industry has shifted from an initial phase driven by cost concerns due to high lithium carbonate prices to a phase of mature technology and clear business models with large-scale production. In terms of pricing, sodium batteries have reached parity with lithium batteries; in terms of applications, sodium batteries show potential in energy storage, light electric vehicles, start-stop power supplies, electric engineering vehicles, new energy vehicles, AI data centers, and more.

The industry growth and potential for sodium batteries are promising. By 2025, global sodium-ion battery shipments are expected to reach 9 GWh, a 150% increase year-over-year; by 2030, global sodium battery shipments are projected to surpass 1,000 GWh, with a compound annual growth rate exceeding 100%.

(3) Focus on Changes in Key Links for Large-Scale Sodium Battery Applications

Recognizing that sodium batteries serve as an effective supplement to lithium battery performance shortcomings and that prices have entered a level suitable for large-scale application, we anticipate sodium batteries will soon begin to scale up. The main changes and focus areas in materials include: 1) Aluminum foil: potential for increased usage amid inflation; 2) Cathode and anode materials: the most significant changes compared to lithium batteries and core performance indicators; 3) Electrolytes and separators: tailored for sodium batteries, such as replacing lithium salts with sodium salts in electrolytes, and increasing separator porosity.

Investment Recommendations

We believe that sodium batteries, which initially developed due to cost concerns from high lithium carbonate prices, have gradually entered a phase driven by technological maturity, a complete industrial chain, and clear application fields. They are expected to effectively complement lithium batteries’ technical limitations.

First, we are optimistic about the “value inflation” in the aluminum foil segment, with key beneficiaries including Ding Sheng New Materials. Additionally, we recommend focusing on: 1) Sodium batteries: overall material performance and direct downstream demand; 2) Cathode and anode materials: core performance and cost optimization; 3) Electrolytes and separators: improving sodium battery performance.

Beneficiary companies include CATL, BYD, EVE Energy, Vico Technology, Chuan Yi Technology, Prite, Rongbai Technology, Tongxing Technology, BTR New Energy Materials, Shengquan Group, Putailai, Tian Cai Materials, Duofuo, Enjie, and others.

Risk Tips: Major changes in technical routes; underperformance of new product releases; significant fluctuations in sodium and lithium battery costs and prices; underachievement in capacity expansion; lower-than-expected downstream demand, etc.

(Source: First Financial)