(Yicai) Oct. 26 -- Ronbay New Energy Technology, the leading supplier of sodium-ion battery cathode materials for Contemporary Amperex Technology, said it will invest CNY3.6 billion (USD536.3 million) to further ramp up relevant production, less than three months after unveiling plans to spend CNY4.7 billion in its first large project in the fast-emerging segment.

Ronbay plans to build a sodium-ion battery cathode material plant with an annual production capacity of 200,000 tons in Xiangyang, China's central Hubei province, the Ningbo-based company announced late on Oct. 23. Construction will start next month and take about 12 months.

Around 48 percent of the investment will come from bank loans, 18 percent from customer prepayments, and the rest from the firm's internal funds and other fundraising channels, Ronbay noted. The return on investment will likely stand at about 16.2 percent, it added, without disclosing further details.

Last November, Ronbay announced it had agreed to supply more than 60 percent of CATL's total sodium-ion battery cathode materials from this year through 2029.

Ronbay operates only one sodium-ion battery cathode material production line in southwestern Guizhou province, with an annual capacity of 12,000 tons. At the end of July, the company announced plans to build a new plant of the same type in Hubei's Xiantao with an output of 300,000 tons a year for CNY4.7 billion.

According to the latest announcement, a pilot production line with an annual production capacity of 6,000 tons has gone live at the Xiantao factory. In addition, work has begun on the project's first phase: a production line with an annual capacity of 50,000 tons.

Sodium-ion batteries are cheaper, safer, and perform better in low temperatures than lithium-ion batteries, although they have lower energy density. As the technology moves toward mass production and commercialization, sodium-ion battery and upstream materials projects are becoming a major investment focus in China.

Shares of Ronbay [SHA: 688005] ended 0.5 percent higher at CNY20.49 (USD3.07) apiece today. The broader Shanghai market climbed 0.2 percent.

Editors: Tang Shihua, Martin Kadiev