(Yicai Global) May 19 -- Shares of Huamai Technology climbed to a nearly one-month high today after the Chinese telecoms equipment maker said that it is looking to raise up to CNY395 million (USD55.6 million) via private placement to fuel product innovation.

Huamai's stock price [SHA: 603042] jumped by 10 percent to CNY17.85 (USD2.51) this morning, the highest since late April.

No more than 35 chosen investors can subscribe for the shares, and that includes the firm's actual controller Xu Aimin who intends to buy at least 5 percent of the newly issued equity, the Nanjing-based firm said in a statement yesterday.

The company would use more than half of the proceeds to fund its planned expenditure of CNY402 million to make new fifth-generation wireless network equipment. The rest of the raised funds would go to replenish its working capital and repay bank loans.

As 5G infrastructure expands in China, the demand for matching Wi-Fi 6 routers will increase rapidly, particularly involving the gaming sector, the firm explained the reasoning behind the need to upgrade supply.

Editor: Emmi Laine