Shares of China Sun Group High-Tech Company (OTC:CSGH) has been one of the top gainers from the bulletin board today after announcing news this morning about a new agreement with Huanyu Power Source Co., Ltd. (“Huanyu”) to supply up to 60 tons of Lithium Iron Phosphate (LIP). In early trading, China Sun jumped more than 16 percent to $ 0.99 per share on volume of more than 174,000 shares, compared to its average daily volume of only 64,000 shares.
China Sun is a vertically integrated supplier of raw materials for rechargeable Lithium-ion (Li-ion) batteries in China and the agreement with Huanyu is for the supply of a minimum of 40 tons of LIP by the end of calendar year 2010.
China Sun Group’s management believes that the total amount of LIP sold to Huanyu by the end of the current year will be approximately 60 tons.
Prior to signing the contract, Huanyu spent three months testing China Sun Group’s LIP material and an additional three and half months testing the Li-battery applications for the LIP material. Both tests successfully met Huanyu’s production standards. China Sun Group and Huanyu have agreed to hold a meeting at the end of December to discuss Huanyu’s LIP requirements for calendar year 2011.
Huanyu Power Source Co., Ltd. began its main business of R&D, manufacture and distribution of replacement batteries in 1982. Huanyu has established a hi-tech industrial park engaged in the production of Nickel Cadmium, Nickel Hydrogen, Lithium ion and Lead Acid batteries, in more than 100 models with a daily capacity in excess of 2 million secondary batteries. Huanyu currently has more than 10,000 employees with 400 dedicated to research.
“We are excited to announce our first agreement with Huanyu Power Source Co. as Huanyu is the first company to manufacture batteries at the China New Energy Automobile Production Experimental Site,” commented Mr. Guosheng Fu, the recently appointed Chief Executive Officer of China Sun Group High-tech Co. “The agreement is a great start as we seek to expand our LIP market, and begin the industrialization of our LIP production line.”
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