(Yicai) Sept. 1 -- Shares of Gotion High-Tech surged by their daily trading limit after the Chinese electric vehicle battery giant, whose biggest investor is Volkswagen Group, unveiled a plan to invest CNY8 billion (USD1.1 billion) to build two new lithium battery factories to diversify its product offering and meet clients' growing demand.

Gotion [SHE: 002074] soared 10 percent to CNY40.12 (USD5.63) a share as of lunch break in Shanghai today, a record high since August 2022. The stock price fluctuated unusually during trading hours on Aug. 29 before the announcement, closing up 10 percent.

Each of the new plants will have an annual capacity of 20 gigawatt hours and cost CNY4 billion to build, Gotion announced in a statement hours later on Aug. 30. The first will be located in Nanjing in Jiangsu province and the second in Wuhu in Anhui province, two cities sitting on the lower reaches of the Yangtze River.

The new factories will be built in phases and completed within 24 months from the commencement date, Gotion noted, adding that the firm aims to diversify its product portfolio, raise its production capacity, improve its capacity planning, and meet increasing demand from its customers.

Gotion's operating revenue rose 15 percent to CNY19.4 billion (USD2.7 billion) in the first half of this year from a year earlier, with overseas income making up a third of the total, according to its financial report released on the same day. Revenue from its power battery business accounted for 73 percent of the total and that from its energy storage battery division for 24 percent. In addition, its operating income topped a record CNY10.3 billion last quarter.

Net profit jumped 35 percent to CNY367 million (USD51.5 million), with second-quarter profit reaching CNY266 million, a record high for the period over the past seven years, Gotion pointed out.

Volkswagen China Investment spent about EUR1.1 billion (USD1.3 billion) for a 26 percent stake in Gotion in May 2020, becoming its largest shareholder.

Editor: Martin Kadiev