Hangzhou First Applied Materials Co. Ltd. announced on April 25 that it will invest RMB 1.653 billion in four capacity expansion projects in order to grow its core business units and enhance their competitiveness and profitability. The company supplies materials for PV equipment (e.g., EV film and backsheets) and electronics. This announcement was first picked up by local Chinese news outlets and renewable energy news websites. Details about the four projects are as follows:
The first project is an additional annual production capacity of 250 million square meters for EVA film used in the encapsulation of high-efficiency PV cells. The project will take three years to complete and entail an investment of around RMB 549 million. The parent company will be responsible for carrying out this project.
The second project is an additional annual production capacity of 100 million square meters for high-resolution photosensitive dry film. The project will take two and a half years to complete and entail an investment of around RMB 253 million. A wholly owned subsidiary based in Hangzhou will be responsible for carrying out this project.
The third project is an additional annual production capacity of 61,450 metric tons for synthetic resin and additives. The project will take three and a half years to complete and entail an investment of around RMB 492 million. A wholly owned sub-subsidiary based in Guangdong will be responsible for carrying out this project.
The fourth project is an additional annual projection capacity of 5 million square meters for flexible copper clad laminate. The project will take two and a half years to complete and entail an investment of around RMB 359 million. The above-mentioned subsidiary in Hangzhou will be responsible for carrying out this project.
In its announcement, First Applied Materials said that all four projects are in the preparation stage and will be financed through its own fundraising efforts. The plans for the last two projects had already been approved by the board of directors and shareholders in 2021 but later underwent some revisions.
First Applied Materials also stated that it is currently the leading supplier for EVA encapsulation film with a global market share of more than 50%. Hence, the successful implementation of these four capacity expansion projects will enable the company to further scale up its output to meet the demand from the PV supply chain. The additional production capacity will contribute to the optimization of the company’s product mix, increase the added value to its encapsulation films, and improve its core competitiveness. With regard to the project for adding production capacity for EVA encapsulation film, its successful implementation will help maintain the company’s leadership in this market by strengthening the existing advantages in terms of production scale, technology, etc. In sum, the four projects fit into the company’s development strategy and are expected to deliver significant operational and financial benefits once they are activated.