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Shares of Mingzhu Plastic skyrocketed to the daily trading ceiling after the company announced a nearly CNY3.4 billion (USD497.4 million) investment to establish a manufacturing facility in South China, significantly boosting its lithium battery separator output.
The stock closed 10 percent higher at CNY6.44 (approximately 95 cents), maintaining the limit-up streak throughout the trading session. This new project is set to increase the company’s annual lithium battery separator capacity to 4.2 billion square meters from current levels, positioning it among the top global suppliers in the industry.
The company revealed late yesterday that the new production base would be located in the Zengcheng Economic and Technological Development Zone in Guangzhou. The facility will feature eight wet-process lithium-ion battery separator lines and seven polyethylene (PE) pipe production lines.
Once operational, the plant is projected to produce 2.4 billion square meters of wet-process lithium-ion battery separators and 30,000 tons of PE pipes each year. The expansion will also elevate the company’s annual PE pipe capacity to approximately 229,500 tons.
The company plans to establish a joint venture with an investment firm owned by the Zengcheng district government to manage the project’s development, investment, and operations. The joint venture will have a registered capital of CNY1.2 billion, with the company holding a 75 percent stake based on its investment contribution.
This new South China facility will enable the company to capitalize on growth opportunities in the Guangdong-Hong Kong-Macao Greater Bay Area, enhance economies of scale in relevant sectors, and increase its market presence in southern China, the announcement stated.
Specializing in plastic processing, the company had a lithium battery separator production capacity of 740 million square meters last year, with this segment accounting for more than a quarter of its total revenue. Major battery manufacturers such as Contemporary Amperex Technology and BYD are among its key clients.
With the new South China plant in operation, the company’s annual lithium battery separator capacity is expected to place it among the leading global suppliers, ranking just behind China-based SEMCORP Advanced Materials Group and Shenzhen Senior Technology Material.
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