(Yicai Global) July 1 -- Shares in Tongwei advanced today after the leading Chinese polysilicon and photovoltaic cell developer announced that it expects profit in the first six months this year to nearly triple from the same period last year as the price of the key raw material used to make solar cells continues to surge.

Tongwei’s stock price [SHA:600438] was trading up 3.12 percent at CNY44.62 (USD6.90) at 2:15 p.m. today.

Tongwei is anticipating net profit of between CNY2.8 billion (USD433 million) and CNY3 billion in the six months ended June 30, up to three times more than the CNY1 billion it made in the same period last year, the Chengdu, southwestern Sichuan province-based company said yesterday.

The main reason for the big jump in profit is because high-purity crystalline silicon is in short supply and prices have risen sharply, it said. Prices have surged 56 percent in the last three months to CNY134,000 (USD20,722) per ton, according to business data platform 100PPI.

To meet surging demand, the company is planning to invest CNY14 billion (USD2.2 billion) to expand capacity at an existing production line in Leshan, Sichuan province to boost the annual output of high-purity polysilicon by 200,000 tons, four times the current 50,000 tons.

Together with other expansion products underway across the country, Tongwei expects to have an annual output of 430,000 tons by the time the Leshan extension is complete, it said.

Construction at the Leshan plant will be in two phases. The first phase, costing CNY7 billion, should be finished by December next year and will have an annual production capacity of 100,000 tons. The timing of the second phase has yet to be determined, the company said.

Tongwei is also a major solar cell producer and a builder of PV power stations. It has an annual production capacity of 27.5 gigawatts of PV cells and its PV power stations have a total installed capacity of 2 GW.

Editor: Kim Taylor