Important Information

Investors should not base investment decisions on this material alone. Please refer to the Prospectus for details including the product features and the risk factors. Investment involves risks. Past performance is not indicative of future performance. There is no guarantee of the repayment of the principal. Investors should note:

The investment objective of Global X China Electric Vehicle and Battery ETF’s (the “Fund”) is to provide investment results that, before fees and expenses, closely correspond to the performance of the Solactive China Electric Vehicle and Battery Index.
The Fund is exposed to concentration risk by tracking a single region or country.
The Index constituents may be concentrated in a specific industry or sector, which may potentially more volatile than a fund with a diversified portfolio.
Investment in Emerging Market, such as A-share market, may involve increased risks and special considerations not typically associated with investments in more developed markets, such as liquidity risk, currency risks, political risk, legal and taxation risks, and the likelihood of a high degree of volatility.
The Stock Connect is subject to quota limitations. Where a suspension in the trading through the Stock Connect is effected, the Sub-Fund’s ability to invest in A-Shares or access Mainland China markets through the programme will be adversely affected.
Listed companies on the ChiNext market and/or STAR Board are usually subject to higher fluctuation in stock prices and liquidity risks, over-valuation risk, differences in regulation, delisting risk, and concentration risk.
There are risks and uncertainties associated with the current Mainland China tax laws, regulations and practice in respect of capital gains realized via Stock Connect on the Fund’s investments in Mainland China. Any increased tax liabilities on the Fund may adversely affect the Fund’s value.
The trading price of the Fund’s unit on the SEHK is driven by secondary market trading factors, which may lead to a substantial premium or discount to the Fund’s net asset value.
The Fund’s synthetic replication strategy may invest up to 50% of its net asset value in financial derivative instruments (“FDIs”), which may expose the Fund to counterparty/credit risk, liquidity risk, valuation risk, volatility risk and over-the-counter transaction risk. The Fund may suffer losses from its usage of FDIs.
The Manager may at its discretion pay dividends out of the capital of the Fund. Distributions paid out of capital, represent a return of an investor’s original investment or its gains and may potentially reduce the Fund’s Net Asset Value per Share as well as the capital available for future investment.
The Fund may suffer from a losses or delays when recovering the securities lent out. This may potentially affect its ability to meet payment and redemption obligations. Collateral shortfalls due to inaccurate pricing or change of value of securities lent, may cause significant losses to the Fund.

Quarterly Earning Update – Global X China Electric Vehicle and Battery ETF (2845)

By: Bingyao Chen

Industry Update

Divergent August EV Sales: According to CPCA, August NEV wholesale sales volume was 1.3mn, +10% YoY, +24% MoM. By individual brand, BYD reported August NEV PV sales of 374k units, flat YoY and +9% MoM. Overseas sales contributed 22%. Xpeng recorded YoY sales growth of +169% YoY to 38k, with MONA exceeding 15k. Li Auto sold 28.5 units in the month, -41% YoY. Management now targets monthly BEV sales to reach 18-20k units at a steady state. (for reference only, abovementioned stocks are not necessarily in the constituent list of the ETF).

Battery material costs remained low: Battery grade lithium carbonate price at the last week of August was Rmb77.5k/ton, -3.1% wow, -5%/+1%/+2%/+18% vs. average of 3Q24/4Q24/1Q25/2Q25. Battery materials prices have decreased by over 80% from its peak in 2022, supporting the continued cost optimization for battery makers and EV manufacturers. (Goldman Sachs, August 2025)

Stock Comments

Shenzhen Inovance recorded 18% return in the month, a key contributor to the ETF. The company reported better than expected 2Q25 results, with revenue rising 19% YoY to Rmb 11.5bn and recurring Net Profit rising 13% YoY to Rmb 1.4bn. Inovance is spending increasing efforts on humanoid robot components, and is developing a series of modularized and standardized products. The company targets to debut humanoid robot components around September. (Company Data, Mirae Asset, August 2025)

CATL recorded 16% return in the month, a key contributor to the ETF. The company reported solid 2Q25 results, with record high net profit of Rmb 16.5bn (+34% YoY) driven by overseas expansion. Battery unit profit remains stable at Rmb110/kWh, thanks to raw material cost deflation and well executed cost control. In 1H25, overseas markets marked 34% revenue contribution amid robust EV momentum in Europe, while overseas GPM edged up by 4ppt to 29%. (Company Data, Mirae Asset, August 2025)

Tuopu recorded 36% gain in the month, a key contributor to the ETF. 2Q25 result was a slight be, with revenue up 9.7% YoY/24.3% QoQ to Rmb7.17bn, which we mainly attribute to its active penetration into domestic OEMs. Tuopu is already partnering with global top humanoid robot manufacturers on linear actuators, rotary actuators and dexterous hand motors. It is also tapping into other robot-related areas such as body structures, sensors, foot shock absorbers and electronic flexible skins. (Company Data, Mirae Asset, August 2025)

BYD reported a relatively weak set of quarterly results, with 2Q25 earnings of Rmb6.4bn (-30% YoY and -31% QoQ), below market expectations. Revenue grew 14% YoY to Rmb201bn. GPM was the key disappointment, with 2Q GPM falling 3.8ppts QoQ to 16.3%, dragged by dealer rebates, BoM cost increase, and price cuts in May. Price cut and Deal rebates could be oneoff and not extended into 2H. With stabilizing price and government’s ongoing anti-involution campaign, unit profit in the domestic market could further recover into 2H. On the other hand, overseas volume is tracking better than expectation, supporting both revenue and profit growth for BYD. Despite near term headwinds, long term outlook for BYD remains robust on the back of its vertical integration, technology leadership, and rapidly expanding global footprint. (Company Data, Mirae Asset, September 2025)

Preview

We remain positive on the long term growth potential for EV and battery value chain, along with the upward EV penetration trajectory. Domestic old car replacement demand, as stimulated by scaled-up auto trade-in program (which has been extended in 2025), together with export sales, should support China’s resilient auto momentum and benefit leading domestic brands. Anti-involution campaign by the government could potentially improve the pricing environment. We expect the China auto market to stay competitive with strong new product line-up and technology innovations from leading EV and battery brands, and new entrants such as Xiaomi. BYD’s launch of God’s Eye ADAS in mass market model should accelerate smart driving adoption in China. Geopolitical tensions remain the key risks, but China EV models will still remain competitive under new tariff landscape thanks to its cost advantages. Localized production will be the longer term solution for Chinese brands.

Disclaimer

This document contains the opinions of Mirae Asset Global Investments (Hong Kong) Limited (“MAGIHK”) and is intended for your use only.

It is not a solicitation, offer or recommendation to buy or sell any security or other financial instrument and shall not constitute any form of regulated financial advice, legal, tax or other regulated service. Information contained herein has been obtained from sources believed to be reliable, but is not guaranteed. MAGIHK makes no representation as to their accuracy or completeness and therefore do not accept any liability for a loss arising from the use of this document.

Investment involves risk. Forecasts, past information and estimates have certain inherent limitations. Statements concerning financial market trends or portfolio strategies are based on current market conditions, which will fluctuate. There is no guarantee that these opinions are suitable for all investors and each investor should evaluate their ability to invest for the long term, especially during periods of downturn in the market. Outlook and strategies are subject to change without notice.

Past performance information presented is not indicative of future performance. Before making any investment decision, investors should read the fund’s offering document for further details including the risk factors. Investors should ensure they fully understand the risks associated with the applicable investment and should also consider their own investment objective and risk tolerance level. Investors are advised to seek independent professional advice if in doubt.

Issuer: Mirae Asset Global Investments (Hong Kong) Limited (Licensed by the Securities and Futures Commission for Types 1, 4 and 9 regulated activities under the Securities and Futures Ordinance). This document has not been reviewed by the Securities and Futures Commission or the applicable regulator in the jurisdiction which this article is posted and no part of this publication may be reproduced in any form, or referred to in any other publication, without express written permission of MAGIHK.

Authors: Bingyao Chen (Licensed by the Securities and Futures Commission for Types 4 and 9 regulated activities under the Securities and Futures Ordinance). The author and her associate(s) do not hold the securities/funds mentioned in the article.