(Yicai) Feb. 5 -- Shares of Lizhong Sitong Light Alloys Group plunged despite the major Chinese supplier of aluminum alloy materials and wheels saying its Thai unit received an order potentially worth CNY1.9 billion (USD264 million) from a well-known overseas carmaker.

Lizhong [SHE: 300428] finished down 8.2 percent at CNY13.29 (USD1.85) a share in Shenzhen today, its lowest closing price since July 2021. The stock is down 37 percent since the end of last year due to the decline in the broader Shenzhen market, which shed 1.1 percent today.

New Thai Wheel Manufacturing was named the designated supplier of aluminum alloy wheels for an international carmaker's new models, with production expected to start in September next year, Lizhong said late yesterday. The project will likely have a life cycle of four years, it added.

The client's name was not disclosed due to a confidentiality agreement, the Baoding-based company noted. The value of the order was estimated based on talks with the customer, it added, without providing other details.

This is the second large aluminum alloy wheel order Lizhong has received in just over a month, after announcing one on Dec. 28 worth about CNY840 million (USD116.7 million) from a maker of high-end electric vehicles. The project will likely begin mass production in the first half of 2025 and have a life cycle of five years, it noted.

Lizhong is one of China's largest suppliers of aluminum alloy wheels, with around 60 percent of its products going to overseas customers. Its wheel output reached 18.2 million last year, including 1.4 million for new energy vehicles, and of the 17.4 million aluminum alloy wheels it sold, 1.2 million were for NEVs. Its NEV clients included China’s Nio, BYD, Li Auto, and Xpeng Motors. 

Lizhongs' revenue from aluminum alloy wheels was CNY7.1 billion in 2022, accounting for about 33 percent of its total. The firm invested in and operates two aluminum alloy wheel plants in Thailand.

Editor: Martin Kadiev