(Yicai) Sept. 30 -- Shares in Sokan New Materials Group surged as much as 17.8 percent today after the Chinese high-end coatings supplier said it will build a factory, a research and development hub as well as a service center in California to better serve US customers.

Sokan’s share price [SHA:688157] closed up 14.6 percent at CNY45.40 (USD6.50). Earlier in the day it hit CNY46.80.

The facility, which will cover an area of 2,392 square meters, will engage in the R&D of functional coating materials for consumer electronics and passenger cars as well as small scale production, the Changsha-based firm said yesterday. There will also be warehousing and marketing services to ensure fast delivery to its local clients.

The project will include factory buildings, spread over 958 sqm, as well the installation of laboratories and testing equipment, it said. Construction should take a year, but the start date is not set yet as the project is still pending approval from US and Chinese authorities.

The center will not only allow for quicker response times to its US clients, which include tech giants such as Microsoft, Google, HP, Amazon, and Meta, but will also improve the company’s level of service. It will also help bring in more high-end customers, particularly car manufacturers, thus boosting business, it added.

Although the total investment amount was not mentioned, Sokan said that it would spend USD5.8 million to establish two subsidiaries in California, which will be responsible for the investment, construction, and operation of the project.

Sales of coatings to customers in the consumer electronics industry accounted for 83.9 percent of the company's total revenue in the first half, while that for automobile manufacturers made up 14.4 percent, according to the company's latest semi-annual report.

Editor: Kim Taylor