On Sept. 5, 2014, Chinese LED manufacturer Honglitronic announced it signed an “investment partnership agreement” with Nanchang City government in Jiangxi Province, China, and is currently constructing a new LED manufacturing base in the city. The investment was approved by the company’s board of trustees in a recent meeting, according to a Securities Times report.

To build another LED factory, the company plans to raise financing to purchase 199 hectares (300 mu) of land in the Linkong Economic Zone in the city. Honglitronic has reserved 199 hectares of land for a period of three years, and is planning to invest RMB 1.01 billion (US $160 million) in R&D, production, and sales of LED package components and lighting products.

The company is also carrying out plans to establish a new wholly owned subsidiary Jiangxi Honglitronics, which will be responsible for acquiring the new factory’s land use rights and sales of certain products. Remaining LED products manufactured by the Nanchang site will be sold by other subsidiaries or through a new subsidiary. The registered capital of Jiangxi Honglitronics will be RMB 1 billion.

Honglitronic’s new LED manufacturing site will occupy an area of 200,000 square meters, with the company investing RMB 1.01 billion in the new factory. The first phase of the factory will occupy 100,000 square meters, and will be mainly used for R&D, production, sales of LED package components and lighting application products. The applications include general lighting, backlight source, automotive lighting, special lighting applications, display and other fields. The new factory’s annual LED component manufacturing capacity is expected to reach about 16,200 KK (based on 3014 single LED chip production capacity) after construction is completed. Annual LED production capacity is about 90 million PCS (estimations use LED bulbs production capacity as references). Projected annual market value is RMB 1.58 billion. The future manufacturing site will become the company’s second business development center and production site after the Guangzhou factory.

After the new factory constructions are completed, the company projects annual revenue will be RMB 15.83 billion and net profit to reach RMB 10.92 billion.