Key Takeaways:
China's plan to spend roughly $295 billion building a national network of AI data centers could generate 125 gigawatt-hours of incremental energy storage battery demand over five years, according to CLSA.
China is preparing to invest about 2 trillion yuan ($295 billion) over the next five years to build interconnected AI data centers across the country, Bloomberg News reported Tuesday. The National Development and Reform Commission is among key government agencies drafting the blueprint, which calls for state-owned telecom giants China Mobile and China Telecom to operate the bulk of the facilities.
"125GWh of incremental demand is equivalent to about one-quarter of our forecast for China's energy storage demand this year," CLSA said in a research report, calling the plan a strong catalyst for battery stocks. The broker said recent share price pullbacks present buying opportunities and named Contemporary Amperex Technology Co. Ltd. as its top pick, followed by SIGENERGY, CALB, REPT BATTERO and Gotion High-tech.
CATL, the world's largest battery maker, trades on both the Shenzhen exchange (300750.SZ) and Hong Kong (03750.HK). CLSA rates CATL outperform with a target of 570 yuan on its A-shares and HK$820 on its H-shares. The broker also rates SIGENERGY outperform at HK$608, CALB at HK$49, REPT BATTERO at HK$22 and Gotion High-tech at 41 yuan.
The AIDC buildout requires at least 80% of technology — including AI chips — to come from domestic suppliers such as Huawei Technologies, effectively squeezing out Nvidia and Advanced Micro Devices, according to the Bloomberg News report. That domestic sourcing mandate extends to the energy storage systems needed to power these facilities, creating a direct demand channel for Chinese battery manufacturers.
The plan builds on China's $8.2 billion National AI Industry Investment Fund launched in January and aligns with the country's upcoming 15th Five-Year Plan. U.S. Big Tech companies are expected to spend more than $700 billion this year alone on their own AI infrastructure, underscoring the scale of the global race.
For investors, the 125GWh demand estimate represents a meaningful revenue opportunity for Chinese battery makers already competing in a crowded domestic market. CATL, which reported battery sales of roughly 340GWh in 2025, could see energy storage become an increasingly large share of its mix. The stock's recent pullback from highs may offer entry points, though the plan remains in early discussions and details could change, the Bloomberg News report noted.
This article is for informational purposes only and does not constitute investment advice.
