# CATL Cuts Hunan Yuneng Stake Below 5% as Hunan Yuneng Expands LFP Capacity CATL reduced its stake in LFP cathode maker Hunan Yuneng to below 5% during the three months to September 17, 2026, selling 17\.4597 million shares, while Hunan Yuneng posted 2\.910 billion yuan first-half net profit and is expanding capacity in Guizhou and Spain\. By China EV Signal Published: 2026-10-23T14:34:21.170Z Updated: 2026-10-23T14:34:21.172Z Canonical article: https://chinaevsignal.com/news/catl-hunan-yuneng-stake-cut-lfp-expansion ## Key takeaways - CATL sold 17\.4597 million Hunan Yuneng shares over the three months to September 17, 2026, and its holding, diluted by equity incentive vesting, fell below 5%\. - Hunan Yuneng reported 2\.910 billion yuan in first-half 2026 net profit attributable to shareholders, up 853\.51% year on year\. - Hunan Yuneng raised its Spain base capacity from 50,000 tonnes to 70,000 tonnes and added about 700 million yuan of investment\. ## CATL stake falls below 5% Hunan Yuneng, the largest lithium iron phosphate cathode maker by shipments, disclosed a change in equity interests on September 17, 2026\. Third-largest shareholder CATL sold 17\.4597 million shares over the preceding three months, and equity incentive vesting further diluted CATL's holding to below 5%\. Shanghai Jinsheng New Materials also reduced its stake in roughly the same period, dropping below the 5% disclosure threshold, so further sales would not require disclosure\. ## Profit jumps in first half of 2026 Hunan Yuneng reported 2\.910 billion yuan in net profit attributable to shareholders for the first half of 2026, an increase of 853\.51% year on year\. The company held a 27\.58% share of first-half 2026 LFP cathode sales, ranking first\. The top five sellers together held 53\.04%\. ## Guizhou mine-to-material project enters environmental review Three core sub-projects of Hunan Yuneng's 24 billion yuan mine-to-material integrated project in Weng'an, Guizhou, were published for environmental assessment on the same day in September 2026\. The long-term plan for the Weng'an base covers 800,000 tonnes of LFP cathode material and 1 million tonnes of iron phosphate, along with supporting upstream resource projects\. Total investment is about 24 billion yuan, with a five-year construction period\. Hunan Yuneng's Huangjiapo and Dashichang phosphate mines in Fuquan, Guizhou, have total resources exceeding 63 million tonnes\. Huangjiapo has begun ore output, and Dashichang is expected to start production by the end of 2026\. ## Spain capacity raised to 70,000 tonnes Hunan Yuneng lifted the capacity of its Spain base from 50,000 tonnes to 70,000 tonnes and added about 700 million yuan of investment\. Total investment in the Spain project rose to 1\.65 billion yuan\. ## Cost position and capacity Hunan Yuneng's three expense items totaled 1\.38% of revenue in the first half of 2026, compared with 2\.44% to 2\.59% for Defang Nano, Wanrun New Energy, Fulin Precision and Fengyuan shares, and 6\.58% for Longpan Technology\. Hunan Yuneng's annualized capacity was close to 1 million tonnes at the end of 2025, and 1\.4 million tonnes in the first half of 2026\. Capacity is expected to exceed 1\.8 million tonnes after second-half expansion\. Its capacity utilization was 96\.8% in 2022 and 89\.77% in 2023\. From 2021 to 2025, Hunan Yuneng recorded 9\.16 billion yuan in cumulative cash flow for fixed assets and other investment, negative 5\.41 billion yuan in cumulative operating cash flow, and 15\.174 billion yuan in cumulative financing\. Its debt-to-asset ratio was 60\.35% in the first half of 2026 after private placement funds arrived\. ## High-compaction products High-compaction products accounted for 62\.46% of Hunan Yuneng's total shipments in the first half of 2026\. Industry product generations are divided by compaction density: the third generation at 2\.5 to 2\.6 g/cm³, the fourth above 2\.6 g/cm³, the fifth at about 2\.7 g/cm³, and the sixth targeting above 2\.8 g/cm³\. The theoretical limit is 2\.8 to 3\.0 g/cm³\. ## CATL builds Yaan materials capacity On August 20, 2026, CATL registered a new materials subsidiary in Yaan, Sichuan, planning annual capacity of 40,000 tonnes of lithium carbonate and 30,000 tonnes of lithium dihydrogen phosphate\. CATL's LFP supply agreement with Hunan Yuneng expired at the end of 2024, and the related 500 million yuan prepayment has been fully offset\. ## Industry losses and new entrants China accounts for more than 95% of global LFP cathode material output, compared with 60% to 70% for ternary materials, and about 65% of global lithium refining\. An industry cost index published after a November 2025 seminar at the Ministry of Industry and Information Technology's news center used seven major companies as samples covering 74% of the market\. By that measure, the industry has lost money for nearly three years since 2023\. In the third quarter of 2025, each tonne sold still lost 1,000 to 2,000 yuan, and 16\.7% of companies were profitable\. New capacity is also being planned\. Yuntianhua and Easpring plan a joint LFP project with 350,000 tonnes of annual capacity, Xingfa Group's existing 80,000-tonne LFP line is running at full capacity, and Xinyangfeng plans to invest about 6\.2 billion yuan in 300,000 tonnes of LFP and 100,000 tonnes of iron phosphate in Hubei\. Most of the new capacity is scheduled to start production in 2026 and 2027\. ## Company coverage - [CATL news](https://chinaevsignal.com/manufacturers/catl) ## Original publisher 晚点Auto. Published: 2026-10-23T14:09:10.000Z