Nanjing Hanrui Cobalt Co, one of China's biggest producers of the metal used in electric vehicles (EVs), has applied to list shares in Hong Kong as it seeks funds to expand production and diversify into other battery metals such as lithium and nickel.
The company, which is already listed in Shenzhen and has market capitalisation of 24.1-billion yuan ($3.7-billion), said on Friday it had filed an application to list H-shares on the main board of the Hong Kong stock exchange after receiving approval from China's securities regulator on June 9.
Its application comes as prices for cobalt have risen by more than 40% this year amid resurgent demand from the EV sector.
Hanrui can currently produce 10 500 t of cobalt products and 35 000 t of copper annually through its operations in China and the Democratic Republic of Congo, the world's main source of cobalt.
Funds from the Hong Kong share offering will be used for "overseas investment, acquisition and exploration of upstream mineral resources related to EVs such as cobalt, nickel and lithium," Hanrui said in an application to Hong Kong Exchanges and Clearing.
The proceeds will also go toward expanding Hanrui's production midstream and downstream in China and overseas, said the document, which had amounts in Hong Kong dollars redacted.
Hanrui said it is new building facilities in the southern Chinese city of Ganzhou to produce 10 000 t/y of cobalt chemicals, such as cobalt sulphate, and 26 000 t/y of battery precursor materials.
"Completion of these projects will further expand our cobalt industry coverage and enhance our market competitiveness," it said, putting combined investment at 1.8-billion yuan and estimating that operations will begin in November 2023.