Kangda New Materials plans to invest 646 million yuan to build a project with an annual production capacity of 30,000 tons of polyarylether (PAE)

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On February 10, Kangda New Materials (Group) Co., Ltd. (hereinafter referred to as “Kangda New Materials”) issued an important announcement stating that its wholly-owned subsidiary plans to invest in the construction of a facility capable of producing 30,000 tons per year of polyarylether (PAE). This move is aimed at further expanding its presence in the field of new materials and advancing steadily toward higher-value segments of the industrial chain. A major move! 646 million yuan allocated for new PAE production capacity. On February 10, 2026, the board of directors of Kangda New Materials approved the plan for this PAE project, which will be carried out by its wholly-owned subsidiary Kangda New Materials (Dalian). The total investment is estimated at around 646 million yuan (64,574.31 million RMB), with the actual amount depending on the actual expenditures incurred. The project is located in Haiqingdao Sub-district, Jinpu New Area, Dalian City, with a total land area of approximately 75.32 mu (50,215.14㎡), of which the area occupied by buildings and structures is 20,338.16㎡. Key details of the project: The plans for this project are well-defined, with the following key information: Production scale: After commissioning, it will produce 30,000 tons of PAE per year, along with 8,050 tons of o-cresol as a by-product, and 31,000 tons of the intermediate product 2,6-dimethylphenol (DMP). Investment composition: 591,941,000 yuan for construction costs, 16,602,100 yuan for interest during the construction period, and 37,200,000 yuan for working capital. Sources of funding: include own funds, bank loans, etc., which will be adjusted reasonably according to actual circumstances. Construction period: Estimated at 18 months; the actual progress will be subject to the actual situation. Construction contents: Include DMP, PAE production facilities, as well as utility and auxiliary facilities such as solvent recovery and granulation packaging, along with supporting office and living services. Current progress: In the preliminary preparation stage, working on engineering design and technical bidding. Kangda New Materials identifies five key feasibility factors to ensure the steady progress of the project: 1. Mature technology: The production technology for these products has been in stable use in China for many years; the approach is reliable, and there are existing engineering examples to support it. 2. In line with planning: Located in the Dalian Dagushan Chemical Industrial Park, it aligns with the local industrial priorities, and its products fall under the category of projects that are encouraged. 3. Secure supply chain: DMP raw materials are readily available, and the by-product o-cresol can be used as a raw material for the company’s electronic-grade epoxy resins, enabling resource recycling. 4. Sufficient operations: A dedicated team is established, leveraging existing technologies and management practices along with DCS for full-process control to achieve efficient operations. 5. Significant benefits: By adhering to the principles of a circular economy, material and energy consumption is reduced, resulting in stable economic benefits. Focusing on high-end segments to promote domestic substitution, Kangda New Materials, as a well-known leader in the adhesive industry in China, has established a diversified and specialized strategic framework in the field of polymer materials since its establishment in 1988. The company focuses on the research, development, and industrialization of adhesives, electronic materials, and composite materials. In 2024, its total revenue reached 3.101 billion yuan (a 11% increase year-on-year); in the first half of 2025, its revenue was 2.258 billion yuan (a 65.75% increase year-on-year), while its net profit attributable to the parent company was 51.1737 million yuan (a 190.56% increase year-on-year), showing steady growth in performance. The PAE product included in this lineup has the chemical name poly2,6-dimethyl-1,4-phenylene oxide; it is a special type of thermoplastic engineering plastic that belongs to the amorphous thermoplastic category. It boasts excellent heat resistance, mechanical properties, and electrical properties. It also features low water absorption, good dimensional stability, high creep resistance, as well as superior resistance to acids, bases, and chemicals. It is halogen-free and flame-retardant, and it is one of the lightest engineering plastics available. Its application areas are very wide, mainly covering fields such as power batteries for new energy vehicles, solar photovoltaics, electronics and electrical engineering, water treatment, and cables. Currently, with the rapid development of 5G communications, new energy vehicles, and the electronics and electrical industries worldwide, there is a growing demand for PAE materials. The supply and demand balance for PAE materials is tight both domestically and internationally. The establishment of a production capacity of 30,000 tons will help fill some of the gaps in market supply, alleviate the supply-demand imbalance, and further enhance the self-sufficiency and stability of China’s industrial chain.