Recently, EVE Lithium Energy announced that its wholly-owned subsidiary EVE ENERGY STORAGE MALAYSIA SDN. BHD. (hereinafter referred to as “EVE Energy Storage Malaysia”) will invest in the construction of new energy storage battery projects with its own funds, shares issued and/or self-raised funds, with an investment amount of no more than 8.654 billion yuan.
Obviously, EVE Lithium Energy is vigorously increasing its layout in the Malaysian market.
What is the purpose of investing?
EVE Lithium Energy mainly holds 100% of the equity of EVE Energy Storage Malaysia through its wholly-owned subsidiary EVE Asia Limited. It is understood that EVE Energy Storage Malaysia’s self-financing methods include but are not limited to bank loans, financing from other financial institutions and other diversified channels.
EVE Lithium Energy said that it will rely on its domestic manufacturing advantages and rich operating experience to invest in the construction of a new energy storage project with high safety, high reliability and long life in Kulim City, Kedah, Malaysia. The construction period of the project is planned to not exceed 2.5 years, and the construction land scale is about 484,000 square meters, which is considerable.
Image source: EVE Lithium Energy
EVE believes that the construction of energy storage battery projects in Malaysia conforms to the rapidly growing market demand for global battery supply, which will help further promote its overseas business expansion and meet the growing global demand for energy storage support, thereby strengthening its market position in the field of lithium batteries.
The company emphasized that this will also help deal with the intensifying international trade frictions, “will reduce the losses caused by this risk to a certain extent, help to achieve the growth of business orders,CapacityThe expansion of scale and the overall improvement of operating performance provide solid support for the company to continue to promote its global leading strategy. ”
The choice to focus on the energy storage battery business is because the sector has gradually developed into one of the core pillars of EVE lithium energy, and its contribution can be on par with the power battery business. According to the data, EVE lithium energy storage battery shipments will reach 50.45GWh in 2024, a year-on-year increase of 92%. According to data from energy consulting agency InfoLink, EVE lithium energy energy storage cell shipments ranked second in the world.
Image source: EVE Lithium Energy’s 2024 financial report
The financial report data further confirms the significant increase in the contribution of the energy storage battery business to EVE Lithium Energy’s revenue. In 2024, energy storage batteries accounted for 39% of its total revenue, an increase of about 6 percentage points from the previous year, and the gross profit margin reached 14.7%, which was higher than the gross profit margin of power batteries. Stronger profitability is one of the important reasons why EVE Lithium Energy has increased its energy storage battery business.
However, the investment of 8.6 billion yuan is not a small amount. You know, as a lithium battery platform company, the profitability of EVE Lithium Energy will not be until after 2019, that is, our countryNew energy vehiclesAfter sales once again exceeded the million mark, the breakthrough was ushered in. By 2021, our country’s new energy vehicle sales will enter an explosive stage, and EVE’s profitability will reach a new level, with an annual net profit of nearly 3 billion yuan.
Even so, from 2023 to 2024, EVE Lithium Energy’s annual net profit will only hover in the range of 4 billion yuan. As of the first quarter of 2025, EVE Lithium Energy’s ending cash and cash equivalent balance was 12.9 billion yuan. This means that EVE Lithium Energy’s investment of 8.6 billion yuan in Malaysia this time is slightly higher than its two-year net profit combined, which shows the investment intensity.
In order to further expand financing channels, improve its influence in the global market, and increase its global layout, EVE Lithium Energy has submitted a listing application to the Hong Kong Stock Exchange, which is expected to become an “A+H” listed company, injecting new impetus into future development.
Why Malaysia?
EVE said that the construction of energy storage battery projects in Malaysia has a positive effect and far-reaching significance on improving its global industrial layout.
This is not the first project built by EVE Lithium Energy in Malaysia. As early as 2023, EVE Lithium Energy started construction of a factory in Malaysia, which is its first overseas manufacturing base. According to reports, EVE Lithium Energy’s Malaysia factory project includes two phases, the first phase is the “International Cylindrical Battery Industrial Park” project, with an investment of no more than US$422 million, which has officially started in August 2023.
The first phase of the project mainly produces cylindrical batteries for power tools and electric two-wheelers. In February this year, the first battery cell has successfully rolled off the production line and currently has an annual production capacity of 680 million cylindrical batteries
Its second phase of the project in Malaysia is the “energy storage project” planned this time. In January 2024, EVE signed a memorandum of understanding in Huizhou to establish EVE Malaysia Energy Storage Company, which plans to have delivery capacity in early 2026.
According to the plan, EVE Lithium Energy’s Malaysian factory will not only serve the Asian market, but also radiate the global market. Although the energy storage plant has not yet been put into operation, it has received overseas orders. In December 2024, EVE announced that it had signed a cooperation agreement with an American customer to supply battery cell products to it.
Image source: EVE Lithium Energy
In fact, not only EVE Lithium Energy, but also more and more Chinese battery-related companies are accelerating the layout of the Malaysian market, forming an obvious industrial agglomeration effect. For example, many companies such as Zhuhai Guanyu, Azure Lithium Core, and Haisida have successively implemented projects in the local area.
According to data cited by the Ministry of Commerce, since the beginning of this year alone, Chinese battery industry chain enterprises have invested nearly 20 billion yuan in Malaysia. According to data from the Malaysian Investment Development Board, Chinese companies will account for more than 60% of battery-related foreign investment in 2024.
Malaysia is indeed an ideal investment destination for Chinese battery-related companies.
From a policy perspective, with the support of the “Belt and Road” policy, China and Malaysia have close relations. A few days ago, a spokesperson for the Ministry of Commerce made it clear that China and Malaysia will improve the level of trade facilitation and promote the quality and upgrading of the “two countries and two parks” through strategic docking, coordinated development, policy and system innovation, and international industrial cooperation.
China has been Malaysia’s largest trading partner for 16 consecutive years. In 2024, the bilateral trade volume between China and Malaysia will be US$212.03 billion, a year-on-year increase of 11.4%; Among them, China’s exports were US$101.46 billion and imports were US$110.57 billion.
At the same time, Malaysia has a friendly investment environment and has actively encouraged foreign investors to invest in its manufacturing and related services in recent years. thereintoElectric vehicleand the field of power batteries is a strategic industry supported by Malaysia. At present, Malaysia implements zero import tariffs and consumption taxes on electric vehicles, and the policy advantages are obvious.
More importantly, Malaysia is rich in natural resources and convenient for sea transportation. Not only are oil reserves abundant, but also iron, gold, tungsten, coal, bauxite, manganese, nickel and other minerals.
Building batteries, energy storage and other related factories in raw material production areas can significantly reduce costs and improve product market competitiveness. You know, in battery products, especially energy storage battery products, material costs account for the majority. Nickel, manganese, etc. are the core components of cathode materials.
With multiple benefits such as resources, policies and location, Malaysia has become an important stop for Chinese lithium battery companies to “go overseas”. For EVE Lithium Energy, the accelerated implementation of overseas production capacity is not only expected to increase the company’s share in the global energy storage market, but also further enhance its resilience and initiative in responding to changes in the international trade environment.
Analysts at Pacific Securities believe that the future growth rate of the energy storage market is expected to be higher than that of power and consumer batteries, and the industry is upgrading to large cells and long life. In this context, EVE Lithium Energy’s energy storage gigafactory is expected to seize the commanding heights of technology, superimpose the advantages of overseas market layout, and have broad room for growth in the future.
