(Yicai Global) June 8 -- Shares of China Resources Microelectronics soared after the chip unit of state-owned conglomerate China Resources Group said it will join hands with a state fund to build a CNY7.6 billion (USD1.2 billion) semiconductor wafer plant.

CRM's stock price [SHA:688396] jumped as much as 10.9 percent to CNY72.20 (USD11.30) this morning, nearing an all-time high of CNY74.89 reached last December.

The company will form a joint venture with the National Integrated Circuit Industry Investment Fund Phase II to construct a 12-inch power semiconductor wafer production line in Chongqing, the Jiangsu province-based firm said in a statement yesterday.

The JV, Runxi Microelectronics, will have CNY5 billion in registered capital. CRM will have a 19 percent stake in it with its investment of CNY950 million (USD148.6 million).

The project is in line with CRM’s strategic goals and long-term interests, said the firm. It will expand the company's capacity to consolidate its position in the domestic chip sector, the statement added.

CRM's net profit jumped nearly four times in the first quarter from a year ago due to rising demand, according to its earnings report. Revenue climbed 48 percent.

Editor: Emmi Laine, Xiao Yi