(Yicai Global) March 16 -- Xinte Energy’s shares surged after the Chinese polysilicon supplier said it will seek a secondary listing in Shanghai to raise money for capacity expansion amid soaring prices for the key raw material used in solar cells and modules.

Xinte Energy [HKG: 1799] ended 15.7 percent higher in Hong Kong today at HKD15.76 (USD2.02). Shares of the Urumqi-based company’s parent, TBEA [SHA: 600089], rose 5.4 percent to close at CNY20.85 (USD3.28).

Xinte Energy and TBEA announced the plan in separate statements late yesterday, without revealing the target funding. They said Xinte Energy will invest CNY17.6 billion (USD2.8 billion) to build a new plant in China’s Xinjiang Uygur Autonomous Region and will invest CNY8.8 billion (USD1.4 billion) to set up a local company to run it.

The project, which will produce polysilicon and chemical by-products, will have an annual capacity of 200,000 tons and will be built in two phases over 24 months.

Upstream polysilicon prices surged about 160 percent last year due to growing demand for solar power, boosting Xinte Energy’s revenue and net profit, which skyrocketed 129 percent and 4,756 percent, respectively, in the first three quarters of 2021 from a year earlier. The price has now jumped to around  CNY200,000 per ton.

Xinte Energy produced just 56,000 tons of polysilicon in the first three quarters of last year, according to its own figures.

It has a 200,000-ton plant under construction in the Inner Mongolia Autonomous Region, with the first phase expected to start operations in the second half of the year. Xinte Energy is also upgrading its technologies to boost the annual capacity of existing plants to 100,000 tons.

The new project’s payback period is expected to be six years and three months at a polysilicon price of CNY70,000 (USD11,000) per ton, or less than four years if it is CNY100,000 (USD15,750) a ton, the firms said.

Editor: Futura Costaglione