(Yicai) Aug. 25 -- Shares of Kinwong Electronic surged by the 10 percent exchange-imposed daily trading limit after the Chinese firm said it plans to invest CNY5 billion (USD699 million) to expand its production capacity of high-end printed circuit boards.

Kinwong [SHA: 603228] closed 10 percent up at CNY59.60 (USD8.34) in Shanghai today.

The capacity expansion plan includes the renovation and expansion of Kinwong's existing factory in Zhuhai, Guangdong province, for CNY1.8 billion and the construction of a new plant with an annual output of 800,000 square meters of high-end PCB for CNY3.2 billion, the Shenzhen-based firm announced on Aug. 23.

The plan, which has an estimated after-tax payback period, including construction, of about seven and a half years, will be implemented in phases from this year throughout 2027, according to Kinwong.

About the first phase of the project, Kinwong did not mention by how much the Zhuhai plant's capacity will be increased, but said that the main products will be high-density interconnect PCB used mainly in artificial intelligence servers as well as other PCB products designed to meet the needs of customers in high-speed network communications, automotive intelligent driving, and AI edge applications.

"This investment aims to address the relatively weak position of the Zhuhai factory in the high-end PCB business, promote the upgrading of the company's product structure, and increase the revenue from and market share of high-end PCB products," Kinwong noted.

High-end PCB have become a hot investment direction for the industry recently, given the increased focus on AI technology development. Avary Holding, another Chinese industry giant, announced on Aug. 20 that it would invest CNY8 billion to build a high-end PCB factory to meet new market demand from emerging industries, such as AI servers and humanoid robots.

Editor: Futura Costaglione