---
title: "FENGYUAN plans to raise 1.428 billion through a private placement to expand production, with a profit of 76.93 million in the first quarter and positive operating cash flow"
type: "News"
locale: "en"
url: "https://longbridge.com/en/news/289860549.md"
description: "FENGYUAN plans to raise no more than 1.428 billion yuan through a private placement, of which approximately 70% will be used for the expansion of lithium iron phosphate cathode material production capacity and to supplement working capital. The company's net profit attributable to the parent in the first quarter reached 76.934 million yuan, with operating cash flow turning positive, achieving a turnaround from loss to profit"
datetime: "2026-06-16T03:18:03.000Z"
locales:
  - [zh-CN](https://longbridge.com/zh-CN/news/289860549.md)
  - [en](https://longbridge.com/en/news/289860549.md)
  - [zh-HK](https://longbridge.com/zh-HK/news/289860549.md)
---

# FENGYUAN plans to raise 1.428 billion through a private placement to expand production, with a profit of 76.93 million in the first quarter and positive operating cash flow

**Changjiang Business Daily reports** FENGYUAN (002805.SZ) focuses on the development of its main business and continues to enhance production capacity.

Recently, FENGYUAN announced a large-scale private placement plan, intending to raise no more than 1.428 billion yuan. Approximately 70% of the raised funds will be used for the construction of lithium iron phosphate cathode material production capacity projects.

Changjiang Business Daily noted that FENGYUAN's main business is the production of lithium-ion battery cathode materials and oxalic acid. In recent years, the company has continuously expanded production to meet strong market demand, and its scale has been steadily increasing.

After three consecutive years of losses, FENGYUAN's profits significantly improved in the first quarter of 2026, with a net profit attributable to shareholders reaching 76.934 million yuan, and the net cash flow from operating activities also turning positive.

**Planned private placement to raise 1.428 billion**

According to FENGYUAN's disclosed plan for the issuance of A-shares to specific targets in 2026, the total amount of funds raised in this issuance will not exceed 1.428 billion yuan (including the principal), and the net amount of funds raised after deducting issuance costs will be used for the renovation and expansion project of 100,000 tons of high-performance lithium battery lithium iron phosphate cathode materials, the production line project of 50,000 tons of high-performance lithium battery lithium iron phosphate cathode materials, and to supplement working capital.

Changjiang Business Daily noted that after FENGYUAN went public in 2016, it raised a net amount of 441 million yuan and 926 million yuan in 2021 and 2022, respectively, mainly for the capacity expansion of the company's main products. In this private placement, approximately 70% of the raised funds will be invested in expansion.

Specifically, the investment total for the renovation and expansion project of 100,000 tons of high-performance lithium battery lithium iron phosphate cathode materials is 817 million yuan, with 700 million yuan from the raised funds. The operating entity is FENGYUAN's wholly-owned subsidiary FENGYUAN (Yunnan) Lithium Energy. Once the raised funds are in place, the company will invest the raised funds into FENGYUAN (Yunnan) Lithium Energy through loans or capital increases. The implementation location is Yuxi City, Yunnan Province, and the construction content involves renovating the existing 50,000-ton lithium iron phosphate production line in Yuxi and newly expanding a 50,000-ton lithium iron phosphate production line.

The investment total for the production line project of 50,000 tons of high-performance lithium battery lithium iron phosphate cathode materials is 447 million yuan, with 300 million yuan from the raised funds. The operating entity is FENGYUAN's wholly-owned subsidiary FENGYUAN (Yunnan) Lithium Energy. Once the raised funds are in place, the company will invest the raised funds into FENGYUAN (Yunnan) Lithium Energy through loans or capital increases. The implementation location is Yuxi City, Yunnan Province, and the construction content involves building a new production line for 50,000 tons of lithium battery lithium iron phosphate cathode materials.

FENGYUAN stated that the investment projects for the raised funds revolve around the company's main business, comply with national industrial policies and the company's overall operational development strategy, and their implementation is conducive to further expanding the company's business, ensuring the company seizes opportunities for green energy transformation, enhancing the supply capacity of high-performance products, and increasing the company's market share and business scale In terms of market expansion, FENGYUAN has established long-term and stable cooperative relationships with leading enterprises in downstream industries. In April 2025, the company signed a "Lithium Iron Phosphate Cooperation Framework Agreement" with BYD, building a stable, trustworthy, and win-win partnership for the procurement and joint development of lithium iron phosphate cathode material products for the years 2025-2028; in October 2025, it signed a "Lithium Iron Phosphate Cooperation Framework Agreement" with Chuangneng New Energy, agreeing that FENGYUAN Lithium Energy will supply 100,000 tons of lithium iron phosphate cathode material products to Chuangneng New Energy over the next three years.

Additionally, FENGYUAN plans to use 428 million yuan from this fundraising to supplement its working capital, better meet the funding needs for the company's future business development, further reduce the debt-to-asset ratio, improve the capital structure, and enhance financial stability.

Financial data shows that by the end of the first quarter of 2026, FENGYUAN's total assets had grown to 5.943 billion yuan, and the debt-to-asset ratio had risen to 71.75%. From 2022 to 2025, FENGYUAN's debt-to-asset ratios were 38.17%, 53.33%, 57.31%, and 68.62%, increasing year by year.

**Turning Profit in the First Quarter**

According to the official website, FENGYUAN was established in August 2000 and was listed on the Shenzhen Stock Exchange in 2016. It has now formed a main business model centered on lithium battery cathode materials, supplemented by oxalic acid business. In the lithium battery cathode materials sector, the company has increased investment in capacity and R&D, actively expanded the market, and deepened cooperation with high-value customers to achieve steady growth; in the traditional oxalic acid business, production and sales remain stable, especially refined oxalic acid, which is at the industry-leading level in terms of process and production.

Currently, FENGYUAN has established three major lithium battery cathode material production bases in Zaozhuang, Shandong, Anqing, Anhui, and Yuxi, Yunnan. The company's lithium battery cathode material product structure is complete, covering the current mainstream lithium iron phosphate and ternary materials, widely used in power batteries, energy storage batteries, and consumer batteries, meeting diverse needs. As of July 2025, the company has a total lithium battery cathode material production capacity of 350,000 tons, both under construction and completed.

In terms of performance, from 2023 to 2025, FENGYUAN's operating revenues were 2.777 billion yuan, 1.49 billion yuan, and 2.327 billion yuan, with net losses attributable to the parent company of 389 million yuan, 362 million yuan, and 485 million yuan, and net losses excluding non-recurring items of 392 million yuan, 364 million yuan, and 503 million yuan, respectively.

Entering 2026, FENGYUAN's performance has rebounded.

In the first quarter of 2026, the company achieved operating revenue of 1.383 billion yuan, a substantial year-on-year increase of 276.52%, approaching 60% of the total for 2025. FENGYUAN stated that this was due to the increase in product sales during the reporting period.

At the same time, in the first quarter of 2026, FENGYUAN's net profit attributable to the parent company and net profit excluding non-recurring items both turned profitable, amounting to 76.934 million yuan and 36.5373 million yuan, respectively. The last time FENGYUAN achieved a quarterly profit was in the second quarter of 2023. The company attributed this to the recovery of profitability in the lithium battery cathode materials business during the reporting period In the first quarter of 2026, FENGYUAN's cash collection increased, with a net cash flow from operating activities reaching 7.1379 million yuan, compared to -9.3036 million yuan in the same period last year.

FENGYUAN has consistently adhered to an innovation-driven development strategy, continuously increasing R&D investment to enhance its independent innovation capabilities. As of 2025, the company has applied for a total of 151 patents, with 77 patents granted. It focuses on the research and industrialization of high-performance cathode materials for high energy density lithium batteries, laying out new front-end materials to seize the technological and industrial high ground of new cathode materials for lithium batteries.

From 2022 to 2025, FENGYUAN's R&D investment amounts were 105 million yuan, 291 million yuan, 197 million yuan, and 239 million yuan, respectively, with R&D investment accounting for 6.02%, 10.49%, 13.22%, and 10.26% of operating revenue. Even during periods of loss, the company maintained high investment levels. Meanwhile, the scale of R&D personnel has steadily increased, with the number of R&D personnel being 69, 98, 120, and 136 from 2022 to 2025, accounting for 9.13%, 13.69%, 16.00%, and 15.70% of the total workforce, respectively.

● Changjiang Business News Reporter Xu Yang

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