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China's Lizhong Rises After Gaining Another Wheel Deal From Big NEV Maker
Tang Shihua
DATE:  Sep 18 2023
/ SOURCE:  Yicai
China's Lizhong Rises After Gaining Another Wheel Deal From Big NEV Maker China's Lizhong Rises After Gaining Another Wheel Deal From Big NEV Maker

(Yicai) Sept. 18 -- Shares of Lizhong Sitong Light Alloys Group moved up by 4 percent after the Chinese producer of automotive aluminum alloy said it will supply wheels to a leading new energy vehicle maker’s upcoming Thai plant.

Lizhong's stock price [SHE: 300428] rose as much as 4 percent to CNY24.48 (USD3.40) intraday and closed 1.4 percent up.

The deal should generate CNY68 million (USD9.3 million) in sales revenue for Lizhong, which will increase the total estimate from the client to as high as CNY1.7 billion (USD233.3 million), if taking into consideration other deals the pair signed recently, the Baoding-based firm said in a statement issued after the market closed on Sept. 15. The earlier deals are for the carmaker's domestic plants with the earliest delivery set late this year. The Thai project is expected to start mass production in October 2024.

Lizhong did not disclose the name of the client, but it said in a separate statement the same day that China’s top four NEV startups Nio, Xpeng Motors, Li Auto, and Hozon Auto, along with carmaker BYD, are its clients of aluminum alloy wheels. Moreover, it counts international brands such as Mercedes-Benz, BMW, and Volvo as its customers. 

Among its Chinese clients, only BYD and Hozon Auto are building NEV plants in Thailand and both plants are expected to start operation next year, according to public information.

This is Lizhong's second NEV wheel deal in just over two weeks. On Aug. 28, the firm said it will exclusively supply wheels worth about CNY1.8 billion to another leading NEV developer, with a cycle of three years.

Editor: Emmi Laine 

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Keywords:   Thailand Plant,Lizhong Sitong Light Alloys Group