(Yicai Global) Aug. 13 -- Contemporary Amperex Technology is planning to raise CNY58.2 billion (USD9 billion) in a new share sale, the biggest ever by a private firm on the mainland, to more than double its electric car battery production capacity.

CATL will use 70 percent of the funds, or CNY41.9 billion (USD6.5 billion), to build five productions lines that will hike its annual lithium-ion battery capacity by 137 gigawatt hours and that of energy storage cabinets by 30 GWh, the Ningde, southeastern Fujian province-based said yesterday. CNY7 billion (USD1.1 billion) will go towards research and development and the rest will be used to supplement working capital, it said.

CATL, which produced 114.3 GWh of batteries last year, is already working at maximum capacity to meet surging demand in the new energy vehicle sector. More electric cars were sold in the first half than in the whole of 2019. As a result, battery output tripled in the five months ended May 31. From January to May, China’s installed capacity of EV batteries reached 41.4 gigawatt-hours, half of which was produced by CATL.

Three of the new production lines will be located in the firm’s base of Ningde, one of which will be a mega plant costing CNY18.4 billion (USD2.8 billion) with an annual output of 60 GWh. One will be in Zhaoqing, southern Guangdong province and another in Changzhou, eastern Jiangsu province.

The company expects to break even within seven and a half years of the new plants opening, it said.

By planning this expansion, CATL is looking ahead. Global EV battery shipments are expected to grow at a compound annual rate of 42.7 percent over the next five years to 1,100 GWh by 2025, CATL said, citing data from the Gao Gong Industry Institute. By then, NEV's penetration rate should above 20 percent.

CATL's share price [SHE:300750] was trading up 0.2 percent at CNY503 (USD77) as of 1:30 p.m. China time today, giving it a market capitalization of over CNY1 trillion (USD154.4 billion). The stock has gained 80 percent since March.

Editor: Kim Taylor