Guoxuan GaocCO plans to build a power battery Pack base in Thailand as a joint venture to explore So

With the rapid development of the global new energy market, Guoxuan GaocCO, a leading power battery enterprise, plans to establish a joint venture company in Thailand to build the Pack production line of lithium-ion power batteries and actively explore the Southeast Asian market.

Set up a joint venture in Thailand

On the evening of December 15, Guoxuan Hi-tech announced, GOTION SINGAPORE PTE. LTD. (" Gotion Singapore Pte. LTD. "), a wholly-owned subsidiary of the Company, signed a Joint Venture Agreement with Nuovo Plus Company Limited (" Nuovo ") on December 15, 2022 in Hefei, Anhui Province, China by means of online cloud signing.

In order to give full play to the core advantages of both parties, realize the interconnected development of the upstream and downstream industries, and jointly explore the new energy market in Southeast Asia, both parties intend to jointly establish a joint venture company NV Gotion Co., Ltd. (the specific name shall be subject to the actual registration, hereinafter referred to as the "Joint venture Company") in Thailand to construct the lithium-ion battery Pack base.

The initial registered capital of the joint venture is 300 million baht (RMB 60.06 million at exchange rate), of which Singapore Guoxuan holds 49% of the equity and Nuovo 51% of the equity. The total investment of the joint venture company is expected to be 600 million baht (120 million RMB according to the exchange rate), and the joint venture parties will contribute in proportion to the corresponding equity.

It is disclosed that Nuovo is a company incorporated under the laws of Thailand, established on January 11, 2022, with its headquarters located in Donmueang District, Bangkok, Thailand. Mainly engaged in battery business and battery industry chain investment related business, supporting the electric vehicle industry in line with Thailand's automobile industry policies, and the development of energy storage system industry which is easy to store renewable energy and can be used continuously and stably.

Nuovo is part of PTT Public Company Limited. (the "PTT Group"), a joint venture between PTT Group and Global Power Synergy Public Company Limited, a power utility company in which it controls. Thailand's PTT Group is the largest state-controlled energy and petrochemical company in Thailand and one of the world's top 500 enterprises.

As agreed by the parties, Gosian Singapore shall provide technical and engineering support to the Joint Venture Company individually or through one or more of its subsidiaries in accordance with the Technology Licensing and Technical Support Agreement entered into between it and the Joint Venture Company. Nuovo shall provide administrative services in the phases of land acquisition, plant construction, personnel recruitment, bank financing, customer development and ongoing operations as agreed in the Administrative Services Agreement signed between Nuovo and the JV.

The products of the joint venture mainly include the design, development, verification, manufacturing, supply and after-sales service of battery modules, battery packs and battery management systems, which are suitable for all kinds of commercial vehicles, passenger vehicles, special vehicles, two-three-wheelers and energy storage systems within the region.

Expand the market in Southeast Asia

Under the premise of high and fluctuating prices of power lithium battery raw materials and continuous increase in R&D investment, Guoxuan High-tech achieved a substantial increase in revenue and net profit in the first three quarters of 2022 compared with the same period last year.

In the first three quarters of 2022, the operating revenue of Guoxuan Gaocco was 14.426 billion yuan, up 152% year on year, the net profit of the parent was 150 million yuan, up 121.4% year on year, and the gross profit margin was 14.12%.

In the previous disclosure of investor relations activity records, Guoxuan said that the outlook for the fourth quarter and next year, with Tongcheng, Nanjing, Liuzhou, Yichun four bases of new production capacity has been released, will further guarantee the delivery of orders, shipments are expected to continue to improve, the company is confident in the fourth quarter and next year's business.

Under the stable growth of domestic market and the improvement of production capacity, Guoxuan High-tech began to layout in Southeast Asia.

According to the plan, the joint venture company plans to build the Pack production line of lithium-ion power batteries in the Eastern Economic Corridor of Thailand. It is expected that the first phase of the production line will be put into operation in the fourth quarter of 2023 and provide high-quality battery products to the market, according to the official wechat of Guoxuan Gaocco. While realizing localized battery manufacturing and market development in Thailand, Shin-Guo-Xuan of Thailand will actively explore the ASEAN new energy market and devote itself to building a battery export base in ASEAN.

For the foreign investment, Guoxuan Gaoke said in the announcement, is an important part of the company's globalization strategy, for the company to expand the Southeast Asian market, improve market awareness, to build an international brand image is of great significance. PTT Group is Thailand's national energy Corporation. Nuovo is PTT Group's main company for green energy development and new energy industry development. The establishment of the joint venture and the establishment of the strategic partnership between the two parties will help to improve the level of sustainable energy use in Thailand. It will help to support PTT Group to achieve net zero emissions by 2050 and Thailand to achieve net zero emissions by 2065, boost the comprehensive electrification process of Thailand, promote the company's lithium ion power battery products export to ASEAN, and lay a solid foundation for the company's international market expansion and sustainable development.

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