(Yicai) Dec. 6 -- Shares of Rongtai Electric Material surged over 8 percent after the Chinese maker of mica composite materials said it expects to gain up to USD358 million by supplying products to an overseas manufacturer of new energy vehicles.

Rongtai’s share price [SHA: 603119] closed up 1.6 percent at CNY26.72 (USD3.70) after soaring as much as 8.3 percent intraday.

A foreign carmaker has chosen Rongtai as its supplier of insulating parts to prevent thermal runaway in three new models, the Zhejiang province-based company announced yesterday, without disclosing the name of the client due to confidentiality.

The contract for three projects is expected to carry a full life cycle of five to eight years. It is predicted to bring from USD256 million to USD358 million in revenue to Rongtai. Rongtai is expected to start production for the client in the third quarter of 2024.

Becoming a designated supplier should help Rongtai enhance its competitiveness and sustainable development abilities in the market of insulating materials to address NEV batteries' tendency to overheat, the firm added.

Rongtai is a supplier of high-performance insulation materials that are used in motors and home appliances, according to the company’s website.

Editor: Emmi Laine