Guoxuan's Shares Hit Price Ceiling After Confirming Equity Talks With Volkswagen
Tang Shihua
DATE:  Jan 20 2020
/ SOURCE:  yicai
Guoxuan's Shares Hit Price Ceiling After Confirming Equity Talks With Volkswagen Guoxuan's Shares Hit Price Ceiling After Confirming Equity Talks With Volkswagen

(Yicai Global) Jan. 20 -- The stock price of Guoxuan High-Tech reached another daily upper limit after China's third-largest electric car battery maker said it is boosting production, as well as confirmed that Germany's Volkswagen may become an investor. 

Guoxuan's shares [SHE: 002074] climbed 10 percent to close at CNY20.67 (USD3.02) each, a 52-week high for the stock which has gained 68 percent in the past 12 months. Its market cap rose to CNY21.63 billion (USD3.2 billion), which is still just a fraction of that of Contemporary Amperex Technology, China's largest battery maker.

Guoxuan is in talks with Volkswagen about strategic cooperation in terms of technology, products, and capital but nothing has been signed yet, the Hefei-based firm said in a statement today. 

Reuters reported on Jan. 17 that Volkswagen could become the Chinese firm's second-biggest shareholder, marking the Wolfsburg-based car giant's first direct ownership in a Chinese battery maker. 

The company has penned an agreement with Liuzhou's administration to construct a plant in the Guangxi Zhuang Autonomous Region to increase its annual capacity by 10 gigawatt hours to meet regional demand, it also said today, without disclosing financial details. If the southern city needs new electric buses, the firm is first in line to provide them, it added. 

The company has another plant underway in Northern China's Tangshan. Last November, it said it will invest CNY5.5 billion (USD783 million) in the factory that should be running at full steam by the end of 2021.

The Liuzhou plant will reach half of its total capacity after 15 months of construction, the firm added in today's statement. The factory will run in full swing after the second phase that takes another 15 months. 

By the end of 2018, the company had a lithium power battery capacity of 16 GWhs, according to public data.

Editor: Emmi Laine

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Keywords:   Lithium Battery,Electric Vehicle,Guoxuan High-Tech,Volkswagen