Received orders for lithium battery from Harrow and Meituan Corun plans to expand Yiyang base with 1.5 billion yuan

On the evening of October 11, Corun (600478.SH) announced that the company signed the 'Yiyang High-tech Zone Investment Promotion Contract' with the Management Committee of Yiyang High-tech Zone and Yiyang High-tech Investment, and plans to relocate and expand the 'Corun lithium-ion battery' Industrial Park'. The total investment of the Yiyang project is 1.5 billion yuan, of which fixed asset investment is no less than 800 million yuan. An insider of the company told a reporter from the Financial Association that the current location of Corun Yiyang Company needs to be relocated due to high-speed rail construction, and the company has recently received several orders for lithium batteries such as Harrow and Meituan, and its production capacity is in urgent need of expansion. Therefore, the relocation and production expansion project of Yiyang Company, on the one hand, is to cooperate with local urban planning and development, on the other hand, it is also based on the consideration of expanding the company's lithium battery product market share. In the future, it will increase the lithium battery supply capacity in the fields of electric bicycles and shared charging cabinets. Yiyang Corun is a subsidiary of Corun. The company has been officially included in the industrial chain of advanced energy storage materials and power batteries in Hunan Province. Yiyang Corun will relocate and expand production and construct new projects. In the expansion of the original battery production capacity, it will also carry out new product research and development. Yiyang Corun originally used high-temperature batteries and nickel-metal hydride power batteries as its leading products. Since 2018, it has begun to deploy lithium batteries and has made rapid progress. The annual revenue growth rate of the lithium battery business is nearly 50%, which has made outstanding contributions to Corun’s revenue. It is understood that Yiyang also hopes to promote the expansion of lithium battery projects in the high-tech zone and the settlement of new lithium power batteries by integrating the industrial resources of leading companies such as Corun. Yiyang will also become the Ru0026D headquarters and first industrial base of Corun lithium battery. According to the official website of Yiyang Hi-tech Zone, the new project signed this time is located in the east of Yiyang Hi-tech Zone, south of Yuxingshan Road, east of Yuanshan Road, and north of Putang Road. It covers an area of u200bu200babout 260 mu and a construction area of u200bu200babout 124,000 square meters. . The total investment is 1.5 billion yuan, of which the Yiyang High-tech Zone Management Committee will provide 150 million yuan in support funds, and the maximum relocation compensation fee will not exceed 250 million yuan. In other words, for a total investment of 1.5 billion yuan, Corun is expected to get back 400 million yuan in bonuses from the government. The project consists of two parts. The first is to relocate the company’s subsidiary company Yiyang Corun Battery’s old factory to the Eastern Industrial Park of Yiyang High-tech Zone, and at the same time add production lines on this basis; build electric bicycles, shared charging cabinets, smart home appliances and other civilian use Lithium-ion battery PACK and other production lines. The second is to build a Corun lithium-ion battery industrial park and build a production base for vehicle-mounted composite lithium-ion batteries and PACK. The new project will build production plants, laboratories and public supporting facilities according to production needs. After the project is completed and put into production, it will strive to achieve a 1GWh/year production and sales scale within 4 years, and achieve the goal of an annual output value of 3 billion yuan within 5 years. The company’s interim report showed that the company’s revenue in the first half of the year was 989 million yuan, and the net profit attributable to its parent was -95.906 million yuan. Although it has not yet turned losses, its lithium battery business has become a bright spot. During the reporting period, the company’s holding subsidiary Jinke Company achieved sales revenue of approximately 3 Billion yuan, a year-on-year increase of 22.63%; of which, the lithium battery business achieved sales revenue of 223 million yuan, a year-on-year increase of 43.75%. According to company insiders, Corun has established a strategic cooperative relationship with Harbin Travel in the field of shared motorcycles; in the field of power banks, it has won the favor of a new strategic customer 'Meituan' and realized small-volume supply. The expansion of the Yiyang project may represent that Corun, which has been sticking to nickel and electricity for more than ten years, has finally embarked on a move to explore the transformation of emerging businesses.