By Jiahui Huang
Tongwei, the largest polysilicon maker in the world, said it plans to invest 28 billion yuan ($3.92 billion) to build a factory in northern China, marking the company's fourth project in 2023 that is above CNY10 billion.
The Chengdu, China-based company signed an agreement with local governments in Ordos, Inner Mongolia, to build a two-phase project for industrial silicon and polysilicon production, according to the company's filing on Monday.
The project aims to produce 500,000 tons of industrial silicon and 400,000 tons of polysilicon annually.
The first phase of the project will cover capacity of 200,000 tons each for industrial silicon and polysilicon, to be completed by the end of December 2025, Tongwei said. Polysilicon is used in the manufacturing of solar panels.
The investment to build the new plant won't have significant impact on the company's revenue and net profit for 2023 and 2024, Tongwei said.
The investment comes at a time as China's solar-sector manufacturers face oversupply issues.
"The investment will help the company make the most of the rich natural resources and the photovoltaic industry supply-chain advantages of the Inner Mongolia region, and consolidate the company's leading position in the polysilicon field," Tongwei said in the filing.
Tongwei forecasts global solar installation demand to grow 20% in 2024, mainly driven by strong demand from the Middle East and Africa. It estimates 20% growth from the U.S. and around 10% growth from Europe next year, Citi analysts said in a note.
Tongwei's shares were down 0.4% as of the Tuesday midday break at CNY23.61.
Write to Jiahui Huang at jiahui.huang@wsj.com
(END) Dow Jones Newswires
12-26-23 0011ET
