(Yicai Global) Oct. 10 -- Shares in Hainan Drinda New Energy Technology surged as much as 8.4 percent this morning after the Chinese firm, which is shifting into the solar energy business from making car interiors, said it will invest CNY13 billion (USD1.8 billion) to build a new photovoltaic cell plant.

Drinda’s share price [SHE:002865] closed up 4.2 percent at CNY196 (USD27). Earlier in the day it hit CNY203.82.

The new plant, to be located in Lianshui county, eastern Jiangsu province, will have an annual output of 26 gigawatts of high-efficiency solar batteries, the Haikou, southern Hainan province-based company said yesterday.

Construction of the first phase, costing CNY7 billion (USD1 billion), will start before the end of the year and should reach its designed annual capacity of 13 GW within 12 months, Drinda said. The timetable for the second and final phase will be determined at a later date.

The investment will come from company funds or from self-financing, Drinda said. The local government in Lianshui county will also provide market-based construction services and supporting facilities that it will lease to Drinda at a preferential rate for six years, it added.

The project is expected to bring in revenue of at least CNY14 billion (USD2 billion) a year for the first two years once it reaches full capacity, based on current market prices, it said.

Drinda completed its transformation from a car interior maker into a solar battery producer in June this year. The firm aims to become a PV cell supplier with a photoelectric conversion efficiency of 23.5 percent for its main products, according to the company website.

Unit Shangrao Jietai New Energy Technology has an 8.8 GW high-efficiency solar battery production base in Shangrao, eastern Jiangxi province and is also building a 16 GW N-type high-efficiency PV cell plant in Chuzhou, eastern Anhui province. The company sold 4 GW of batteries in the first half, according to its interim results.

Editor: Kim Taylor