(Yicai) April 3 -- Shares of Jinlongyu Group rose after the Chinese wire and cable supplier said it plans to invest CNY1.2 billion (USD160 million) to build a solid-state battery materials production base.

Jinlongyu [SHE: 002882] was trading up 2.1 percent at CNY17.61 (USD2.42) as of lunch break today. The Shenzhen Component Index fell 1.5 percent, along with other Chinese mainland indexes, as US President Donald Trump announced new import tariffs yesterday.

The solid-state battery materials plant will be built in Huizhou, southern Guangdong province, on a land plot for which Jinlongyu recently acquired the land use rights at an auction, the Shenzhen-based company announced yesterday.

The construction is expected to be completed in one year, the firm noted, without revealing any further details about the project.

Jinlongyu invested CNY82.2 million (USD11.3 million) to research and develop solid-state battery materials last year, bringing the total since 2021 to CNY150 million (USD20.6 million), according to the company's 2024 annual financial statement released yesterday.

In 2021, Jinlongyu initiated a partnership with a technology development company controlled by Chinese solid-state battery technology expert Li Xinlu.

As of the end of last year, Jinlongyu had completed the synthesis, production process validation, product customer evaluations, and safety testing of various solid-state battery materials, including battery cells, electrolytes, separators, and anode and cathode materials, the financial statement noted.

Solid-state batteries are a new type of battery that uses solid electrodes and electrolytes. Compared to conventional batteries using liquid electrolytes, solid-state batteries can increase the energy density and improve the safety of lithium batteries. However, their development is challenging because of high production costs, so their practical application is still in the early stages.

Jinlongyu reported a net profit of CNY140 million and revenue of CNY3.7 billion last year, down 14 percent and 6.5 percent, respectively, from 2023, according to the earnings report. Its performance was impacted by a slowdown in engineering construction and intensified competition in the wire and cable industry.

Editor: Futura Costaglione