SHUANGDENG (06960) has announced that its board of directors has approved a proposal to establish a new wholly-owned subsidiary in Malaysia. This new entity will implement the company's previously outlined future strategy to construct lithium-ion battery production facilities in Southeast Asia. The Malaysian subsidiary is intended to serve as the primary operational unit for the group's business activities in the country. As of the announcement date, the group is currently in the process of identifying a suitable location and sourcing equipment for the production facility to commence operations. The establishment of the subsidiary is subject to completing relevant domestic and overseas filing and approval procedures. The company clarified that, as of the announcement date, no funds raised have yet been utilized for the construction of lithium-ion battery production facilities in Southeast Asia. Beyond what was disclosed in the prospectus, the energy storage market in Southeast Asia has experienced significant growth in recent years, driven by demographic changes and economic development in the region. From 2020 to 2024, the compound annual growth rate of Southeast Asia's GDP was 6.9%. It is projected to increase from USD 3.5 trillion in 2025 to USD 4.6 trillion in 2029, representing a compound annual growth rate of 6.8%. Concurrently, demand for energy storage batteries in the region is rising, supported by population growth and increased expenditure. The board believes that establishing a battery production facility in Malaysia, considering its lower labor and logistics costs, will further expand the group's industrial presence in Southeast Asia and enhance its competitiveness. To improve the group's long-term competitiveness and product portfolio, the board of directors considers the establishment of this new Malaysian subsidiary to be in alignment with the company's development strategy and in the overall interests of its shareholders.
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