(Yicai Global) April 27 -- Shares in Ningbo Shanshan soared by the exchange-imposed limit today after the Chinese battery materials supplier said it will build another production base of anode materials that will increase its output by two-and-a-half times as demand from electric car battery makers grows.

Shanshan’s stock price [SHA:600884] closed up 10 percent at CNY21.52 (USD3.30).

Costing CNY9.7 billion (USD1.5 billion), the project will be funded by unit Shanghai Shanshan Lithium Battery Material Technology, the parent firm said yesterday. The new plant, which will be located in southwestern Yunnan province, will be built in two phases and is expected to be completed by the end of 2024.

With an annual capacity of 300,000 tons of anode materials, the facility will increase Shanshan’s output two-and-a-half-fold. The Ningbo, southeastern Zhejiang province-based company sold 101,000 tons of the materials last year, a year-on-year gain of 71 percent, and sales are expected to double to 200,000 tons this year.

Shanshan’s net profit surged 24 times last year from the year before to CNY3.3 billion (USD503 million) while revenue jumped two-and-half times to CNY20.7 billion (USD3.2 billion), according to its latest financial report. Revenue from its anode materials business accounted for 20 percent of total revenue, soaring 64.4 percent to CNY4.1 billion last year.

Last week, Shanshan attracted battery giant CATL and auto manufacturer BYD as secondary investors in a fundraising campaign for Shanghai Shanshan, securing CNY3.1 billion (USD473.1 million). After the investment is complete, Shanshan’s stake in the unit will fall to 87.1 percent from 90 percent.

Editor: Kim Taylor