(Yicai Global) Sept. 28 -- Chinese power battery maker Eve Energy said it plans to spend a further CNY11.7 billion (USD1.6 billion) to expand its energy storage and battery capacity and buy into two producers of battery raw materials.

CNY10 billion will be used to build a two-phase project in the northern Chinese carmaking hub of Shenyang, the Huizhou-based company said in a statement yesterday. The first phase, with annual output of 20 gigawatt-hours of energy storage and a power battery smart production plant with facilities, will cost CNY5 billion (USD692 million).

The announcement was the latest in a string of capacity expansion plans set out by Ever Energy this year. In April, the firm said it would invest CNY20 billion for a 50 GWh power energy storage battery production base and research center in Chengdu, the capital of Sichuan province. The following month, it said it intended to spend CNY2 billion to build another energy storage battery project with annual capacity of 10 GWh in Yuxi, Yunnan province.

Shares of Eve Energy [SHE: 300014] finished 2.7 percent lower at CNY87.70 (USD12.09) each today, after earlier slumping by as much as 5.5 percent. The Shenzhen stock market fell 2.5 percent.

Eve Energy's planned power battery capacity is more than 200 GWh, the company noted in its first-half earnings report. With the latest announcement, it is expected to have invested nearly CNY40 billion in the energy storage field.

The increased capacity will meet clear customer needs, the firm said earlier, adding it is confident that the power battery industry will maintain rapid growth in the next few years.

In two other statements yesterday, Eve Energy also said it will acquire 20 percent of Shandong Ruifu Lithium Industry for CNY800 million (USD111 million) and a 40 percent stake in BRT New Material Group's unit BTR Sichuan New Material Technology, two upstream companies in lithium carbonate and anode materials.

Ruifu Lithium can produce 25,000 tons of lithium carbonate and 10,000 tons of lithium hydrate a year, and has a 30,000 ton lithium carbonate project under construction. Eve Energy said a stake in Ruifu Lithium will help the firm boost its upstream presence in the battery raw material industrial chain.

Eve Energy and BTR New Material aim to build an integrated lithium-ion battery anode material base with an output of 10,000 tons of lithium-ion battery anode materials per year in Yibin, Sichuan, to be completed by the first half of 2024. BTR Sichuan New Material will be responsible for construction.

Net profit at Eve Energy fell 9.1 percent to CNY1.4 billion in the first half from a year earlier, while revenue soared 128 percent to CNY1.5 billion thanks to new capacity and surging battery shipments, its earnings report showed. The firm's asset-liability ratio rose to more than 65 percent as of June 30, from 35 percent at the end of 2020.

Editor: Futura Costaglione