(Yicai Global) Jan. 27 -- Kuangda Technology Group said a joint venture set up by two of its units will invest CNY5.7 billion (USD900 million) in a project to make chips for electronic devices, sending the shares of the Chinese auto parts maker soaring and tumbling by the daily trading limit.

Kuangda [SHE: 002516] ended today at CNY6.17 (97 US cents), down 10 percent, the exchange-imposed limit. The stock has fallen almost 5 percent so far this month.

Xintou Micro-Electronics Technology signed a deal with a local government body in Hefei, the capital of Anhui province, on Jan. 26 to build a research and development, design, and production base for chips for radio frequency filters, Changzhou-based Kuangda said late yesterday.

The project, which will be built in two phases, will make full use of the JV’s overseas business advantages to help Kuangda become a global leaders in RF front-end products, it added, without giving further details.

RF front-end products are components between RF transceivers and antennas such as power amplifiers, antenna switches, filters, duplexers, diplexers, and low noise amplifiers. Their performance directly impacts the quality of inbound and outbound signals.

Xintou Micro-Electronics was set up in 2020 by Jiaxing-based Kuangda Lanchen Investment Partnership and Jiawang Investment Partnership so that the two subsidiaries could buy 75 percent of NDK SAW, a firm spun off from Japanese quartz crystals maker.

Kuangda said at the time that the move would help it get into the filter and RF front-end products market, helping the firm transform and upgrade its business.

Editor: Futura Costaglione