The latest financing brings Sunwoda EVB's valuation to about RMB 30 billion and takes it one step closer to a spin-off IPO.

Sunwoda Electric Vehicle Battery Co Ltd (Sunwoda EVB), the electric vehicle (EV) battery subsidiary of Chinese battery maker Sunwoda, has closed a new round of financing worth about RMB 8 billion ($1.18 billion), bringing its valuation to about RMB 30 billion, LatePost reported Tuesday.

Sunwoda EVB's latest funding effort was well received by investors and ended up raising several times the amount it had initially planned, according to the report.

With this round of financing, Sunwoda EVB is one step closer to spinning off and going public on its own, the report noted.

Under China's securities regulations, Sunwoda, which is a publicly-traded company, is required to reduce its stake in the subsidiary to less than 40 percent if it wants to spin off it for a separate listing.

Prior to the latest round of financing, Sunwoda's listed entity had a 57.55 percent stake in Sunwoda EVB. After the RMB 8 billion financing, Sunwoda's stake may have been diluted to less than 40 percent, according to LatePost.

Sunwoda was founded in 2008 and listed on the ChiNext stock market, China's Nasdaq-style board for growth enterprises, in April 2011. Its main business is consumer batteries, but its power battery business has been growing rapidly in recent years.

Sunwoda's revenue in 2021 was RMB 37.4 billion, up 25.82 percent year-on-year, of which RMB 20.8 billion, or 55.6 percent of total revenue, was from mobile and digital batteries, up 26.77 percent year-on-year.

Its power battery business had revenue of RMB 2.93 billion in 2021, representing a year-on-year increase of 584.67 percent.

In July, Sunwoda contributed 3.11 percent of China's power battery installed base, ranking fifth behind , , CALB, and Gotion High-tech, according to the China Automotive Battery Innovation Alliance earlier this month.

Hours before LatePost's report, another local media outlet, 36kr, reported that Sunwoda EVB had closed a RMB 6 billion round of financing, exceeding the previously planned RMB 3 billion.

Prior to this round of investment, Sunwoda EVB was valued at RMB 22 billion - 23 billion, according to 36kr.

On June 21, 36kr reported that Sunwoda launched a plan to spin off its power battery business in late 2021, and Sunwoda EVB will be listed as an independent entity, with an IPO application expected to be filed in 2023-2024.

At the end of February this year, Sunwoda announced a capital increase plan for Sunwoda EVB, with the Chinese EV trio - NIO, XPeng Motors and Li Auto - all planning to take a stake.

A total of 19 companies plan to increase their capital to Sunwoda EVB by RMB 2.43 billion, which will give them a 19.5495 percent stake in the company after the capital increase is completed, Sunwoda said in an announcement on February 24.

's affiliates Jiangsu CHJ Automobile Co Ltd, Sky Top LLC and their designees will all invest RMB 400 million and are the two largest capital increase holders, each receiving a 3.2 percent stake, said Sky Top, an entity affiliated with .

Suzhou Weirui Venture Capital Partnership, indirectly owned by William Li, founder, chairman and CEO of , plans to invest RMB 250 million for an approximate 2 percent equity stake.

Chinese battery maker Sunwoda plans to issue GDRs and list them in Europe