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Shares of Shenzhen Hongfuhan Technology surged after the Chinese supplier of precision components for computers, communication devices, and consumer electronics announced plans to invest 1.4 billion yuan (approximately USD 198 million) in constructing a solar power plant in the Democratic Republic of Congo.
As of 1:40 p.m. local time, the company’s stock was up 9.6%, trading at 86 yuan (about USD 12.08). The proposed photovoltaic power facility will have an annual capacity of 200 megawatts and will supply electricity to the Kamoa-Kakula Copper Mine. This initiative aims to help alleviate local power shortages and improve grid stability, the company revealed late September 26.
The project will also include a microgrid and an energy storage system. Construction and installation are slated for completion by May 30 of next year, with grid connection expected by July 31. A joint venture will be formed between the company’s local subsidiary and the local arm of China Sixth Metallurgical Construction to oversee the investment, construction, and operation of the plant.
The project company will be mainly owned by the Hongfuhan unit, holding an 80% stake, with the local Chinese partner owning the remaining 20%. The share distribution will be based on the contributions of each partner. As the primary investor, Hongfuhan will control the project, while the Chinese partner and its subsidiary will handle building, installation, operation, and maintenance.
Initially, after-tax net profits from the project will be split according to ownership ratios. Once the initial investment is recovered, Hongfuhan’s subsidiary will receive 76% of the after-tax net profits, with the remaining 24% allocated to the Chinese partner.
Projected over a 15-year lifespan, the project is anticipated to produce an average annual net profit of approximately 212.8 million yuan (USD 29.9 million), with gross and net profit margins of 69.3% and 59.7%, respectively. Including construction costs, the investment is expected to be recouped within about 5.5 years.
The Kamoa-Kakula Copper Mine, operated by Ivanhoe Mines of Canada, stands as one of the key mining projects in Central and Southern Africa, representing the largest high-grade copper resource in the continent. Capitalizing on the mine’s steady electricity demand will allow Hongfuhan to swiftly implement its photovoltaic business in the DRC, reducing risks associated with overseas growth and expediting its international expansion efforts—creating new opportunities for revenue growth.
While developing the solar power plant marks Hongfuhan’s entry into this sector, the company’s expertise in thermal management solutions and new materials has previously supported photovoltaic clients. This project represents the company’s first overseas investment in a large-scale PV facility.
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