China Auto Manufacturers: CBG Fund-Flow Update (Car-BYD, Battery-CATL, Glass-Fuyao) Mid-Sep

We note that CATL (covered by Jack Shang) H-shares currently trade at a 46% P/E premium over the non-weighted average of BYD and Fuyao H-shares. In contrast, the same measure for A-shares leveled off in early September and fell to a 13% discount (CATL de-rated faster than Fuyao and BYD). In our view, A-share investors appear more cautious, converging CATL's valuation toward Fuyao Glass much earlier than H-share investors, which may suggest that A-share risk-reward for both Fuyao and CATL is currently more attractive than in H-shares. For BYD, BYD-A P/E movements have been more resilient than BYD-H, suggesting mainland investors are relatively more optimistic than global investors—likely reflecting differing views on (1) domestic market consolidation impacts, (2) overseas growth outlook for 2027–28, and (3) the 2H26 earnings forecast. We track the historical valuation correlation among BYD, CATL and Fuyao Glass. The P/E correlation coefficient between BYD-H and CATL-H is 0.16, and betwe