(Yicai) Sept. 30 -- Shares of Huayou Cobalt surged after the major lithium battery material supplier said it had secured a five-year supply deal from South Korea's LG Energy Solution

Huayou [SHA: 603799] jumped 8.3 percent to CNY65.22 (USD9.16) a share as of 1.50 p.m. in Shanghai today, after earlier soaring by as much as the daily trading limit of 10 percent.

Huayou's factory in Quzhou will supply around 76,000 tons of ternary precursor cathode materials to LG Energy or its designated purchasers starting now through the end of 2030, the Zhejiang-based firm announced late yesterday. In addition, its Hungarian plant will provide about 88,000 tons of the materials to LG Energy's Polish factory, it added.

LG Energy is one of the world's largest battery manufacturers. Its factory in Poland is an important lithium battery production base in Europe.

Huayou did not disclose the value of the order, but based on the current average price of ternary cathode materials, it could bring it revenue of about CNY20 billion (USD2.8 billion).

The deal is conducive to deepening the ties between Huayou and LG Energy, the Chinese firm noted, adding that it will boost the market share of related products, enhance the company's core competitiveness in the global lithium battery supply chain, and likely have a positive impact on annual earnings over the next five years.

Huayou has been a regular supplier of battery materials for LG Energy since 2023. It has a joint venture with LG Chem, the parent firm of the Seoul-based firm, focusing on the production of lithium battery cathode materials in South Korea, Indonesia, and other countries.

Editor: Martin Kadiev