(Yicai) Nov. 24 -- Shares of Zhaolong Interconnect Technology fell after the leading Chinese data cable manufacturer said it plans to raise CNY1.2 billion (USD169 million) through a private placement.

Zhaolong [SHE: 300913] was trading down 5.7 percent at CNY29.51 (USD4.16) as of lunch break in Shenzhen today.

Zhaolong intends to issue 77.5 million new shares to no more than 35 investors, the Deqing, Zhejiang province-based firm announced yesterday, adding that it will use CNY660 million (USD92.9 million) of the proceeds for a project in Thailand, CNY350 million for a high-speed cable and connection products smart manufacturing base, and CNY200 million to supplement liquidity.

The Thai project, which will have annual capacities of 200,000 kilometers of data cables, 66,000 km of high-speed and industrial cables, and 8.5 million connection products, will help the company deal with changes in the international trade situation and accelerate its overseas business expansion, Zhaolong noted.

The above high-speed cable and connection products smart manufacturing project will be built in Deqing and have a total investment of over CNY370 million, the company pointed out.

Generative artificial intelligence requires a back-end data center network and a connection speed of 800 gigabytes per second. Zhaolong is the only Chinese firm successfully developing 800G high-speed cables, though they have not yet achieved mass production, with related certification works being advanced orderly, the company said in April.

In the first three quarters of the year, Zhaolong reported a net profit of CNY70.2 million (USD9.9 million), down 30 percent from a year earlier. Revenue fell 9.2 percent to about CNY1.1 billion. In the six months ended June 30, the firm’s revenue from the digital communication cable business accounted for almost 96 percent of the total.

Zhaolong is present in over 100 countries and regions, including Europe, North America, the Middle East, Southeast Asia, and Australia. Last year, nearly 62 percent of its revenue came from overseas markets. Moreover, the firm kept a leading position among other Chinese peers by export value between 2015 and last year.

Editor: Futura Costaglione