CICC has released a research report noting that 1H26 industry results came in line with expectations, with a clear trend of energy storage companies expanding overseas in 1H26, fueling sector earnings growth. The firm is optimistic about the medium-to-long-term growth potential of the energy storage market, though it acknowledges that short-term volatility will likely reshape the competitive landscape. CICC maintains its earnings forecasts, ratings, and target prices for all covered companies, adding that overseas revenue continues to be a crucial earnings support for energy storage firms, and it anticipates that overseas business volume will drive both revenue and profitability improvements next year.
Key takeaways from CICC’s report are as follows. On the utility-scale storage front, project announcements from January to August 2026 were flat year-on-year in number, but project quality has improved. Domestic energy storage project admission standards have been raised, leading to a significant reduction in ineffective projects compared with the prior year. The Strait of Hormuz incident has magnified supply risks for traditional fossil fuels, accelerating energy transition demand in overseas markets and speeding up the construction of energy storage projects, with both developed and developing nations making parallel progress.
Turning to the behind-the-meter segment, continued European subsidies are bolstering residential storage demand, while commercial and industrial (C&I) storage is seeing rapid volume growth. European residential electricity prices remain elevated, providing solid support for household storage demand, while C&I storage is experiencing high growth from a low base. In Asia, Africa, and Latin America, where solar-plus-storage penetration remains low, the gradual achievement of grid parity—coupled with issues like power outages—leads CICC to expect sustained high growth in storage demand across these regions after 2026.
Regarding the competitive landscape, shifting overseas policies and a concentrated wave of new capacity expansions are intensifying rivalry in the energy storage industry. New U.S. grid policies are raising localization requirements for the storage supply chain, and similar measures are emerging in different forms across European and African markets. A fresh round of storage capacity expansions is set to come online between the second half of 2026 and 2027, which could further intensify competition. The key factors determining competitiveness are becoming more complex, and “localization” is likely to emerge as a critical differentiating advantage.
In terms of profit distribution, leading players significantly outperform their peers, with thermal management faring better than battery and inverter makers, which in turn outpace integrators. Battery manufacturers continue to see rising shipments and mostly stable profit growth. Inverter and integrator companies are showing some divergence—some are affected by revenue recognition timing and export tax rebates—but most are making notable progress in overseas expansion. Thermal management, driven by dual demand from AIDC and energy storage, is expected to maintain robust growth going forward, according to CICC.
Risks include renewable energy development falling short of expectations, trade policy risks, and exchange rate fluctuation risks.