(Yicai Global) June 22 -- Shares in Ningbo Shanshan hit a record high today after the Chinese apparel and new-energy firm said it is preparing to invest CNY5 billion (USD773 million) to build a new polarizer production line in southwest China to meet surging demand from liquid crystal display manufacturers.

Shanshan’s stock price [SHA:600884] was trading down 0.05 percent at CNY21.37 (USD3.30) at 1:30 p.m. China time. Earlier in the day it had reached a record CNY21.79.

The new plant, which has a planned annual capacity of 50 million square meters of the optical filters, will be the only polarizer production line in western China and will help ease reliance on imports and relieve tight market supply in the region, Shanshan said yesterday.

Unit Shanjin Optoelectronics Suzhou, in which Shanshan holds a 70 percent stake and South Korea’s LG Chem the remainder, will build the factory in Mianyang, Sichuan province. Construction is expected to be completed by June 2023 and the facility should be operating at full capacity by the end of 2024, it added.

Polarizers are an important component of LCDs needed to display images. Demand on the Chinese mainland is expected to reach 440 million square meters by 2024, a compound annual growth rate of 11 percent from last year, according to UK tech research firm Omdia.

Shanshan has become a major player in the global polarizer field after the Ningbo, eastern Zhejiang province-based firm bought LG Chem’s LCD polarizer operations on the Chinese mainland as well as in Taiwan and South Korea last year for USD770 million. Shanjin Optoelectronics, the resulting joint venture, has an annual output of 130 million square meters, according to the company's website.

Shanshan began as a clothing manufacturer and listed in 1999, but has moved into the new-energy sector and mostly focuses on lithium battery materials which have become a major profit contributor in recent years.

Editor: Kim Taylor