Jiangsu Lopal Tech. Group Co., Ltd. (LOPAL TECH) has submitted a proposal to build its “Indonesia Phase III Project”, a lithium iron phosphate (LFP) cathode-material facility with 120,000-tonnes annual capacity in Batang Industrial Park, Central Java, Indonesia. The total investment is budgeted at US$160 million (approximately RMB1.09 billion).
The project will be executed by PT LBM Energi Baru Indonesia Batang, a wholly owned subsidiary of LBM New Energy (AP) Pte. Ltd., itself an indirect non-wholly owned subsidiary of LOPAL TECH. Financing will combine internal resources, bank borrowings and other self-raised funds, to be injected in stages as construction progresses. The plant is scheduled to break ground in July 2026 with a 12-month construction timeline. Management targets an internal rate of return of 24.38%.
Rationale • Rising global demand: Accelerating growth in electric vehicles and energy-storage systems is driving overseas consumption of LFP cathode materials, an area where non-Chinese capacity remains limited. • Customer base: LOPAL TECH has secured relationships with leading domestic battery makers expanding abroad as well as major international cell manufacturers, underpinning future offtake. • Operational track record: The company cites proven experience in setting up and running overseas facilities, supporting expectations for rapid commissioning and scale-up.
Governance and Compliance • The board approved the proposal on 9 June 2026; shareholder consent is required. An Extraordinary General Meeting is scheduled for 12 August 2026 in Nanjing. • Over the past 12 months, cumulative external investments, including this project, have reached 50% of LOPAL TECH’s latest audited net assets, triggering the need for shareholder approval. • The initiative does not constitute a connected transaction or major asset restructuring under applicable PRC regulations. Any subsequent binding agreements may be subject to Hong Kong Listing Rules disclosure.
Key Risks • Regulatory approvals in both China and Indonesia remain pending. • Intensifying competition as global cathode suppliers expand capacity could pressure returns. • Foreign-exchange volatility may affect project economics. • Market, policy and operational uncertainties could impact the projected 24.38% ROI.
Impact Management expects no material effect on 2026 revenue or net profit during the construction phase. Long term, the facility is intended to boost LOPAL TECH’s international footprint and enhance supply capability for overseas customers in the EV and energy-storage sectors.
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