(Yicai) Oct. 17 -- Chinese battery maker Great Power Energy & Technology aims to restore its fortunes after a difficult year by investing CNY1 billion (USD140 million) in a new lithium battery project.

Great Power Energy will make small power prismatic aluminum shell lithium-ion batteries and capacitor-type lithium-ion batteries at a new plant in Zhumadian, a city in China's central Henan province, the Guangzhou-based firm said yesterday.

The company said the investment will be funded through a combination of its own funds and external financing, and it is considering various fundraising options, including bank loans, convertible bonds, and preferred shares, though no specific plans have been finalized.

Shares of Great Power Energy [SHE: 300438] closed up a little more than 1 percent at CNY30.48 (USD4.28) each today, after earlier climbing by as much as 4.9 percent. The broader Shenzhen market fell over 0.7 percent.

Great Power Energy’s financial performance has been heavily impacted by recent battery price drops. First-half net profit plunged 83 percent to CNY41.68 million (USD5.86 million) from a year ago on a 14 percent decline in revenue to CNY3.77 billion (USD530 million).

In a separate announcement, the company also said it had signed an agreement with CICC Capital, Zhumadian Huanghuai Fund, and Zhanxin Investment to establish a new-energy venture capital fund in Zhumadian.

The fund will focus on investing in the battery industry chain, including materials, energy storage, and new energy vehicles, as well as other strategic emerging industries that can contribute to Zhumadian's industrial upgrade process.

Great Power Energy will contribute CNY200 million (USD28 million), accounting for a 40 percent stake in the fund.

Editor: Tom Litting