South Korean cathode active material supplier L&F is poised to invest 650 billion won ($483.1 million) in the next two years in a new line of production in Daegu, a filing showed Monday.

Once the construction is complete, tentatively by August 2024, the new factory of L&F in Dalseong County, around 240 kilometers southeast of Seoul, will produce nickel-rich cathode active materials for batteries made of nickel, cobalt, manganese and aluminum, with their nickel content comprising at least 90 percent of the total.

The facility will also mass-produce next-generation “single crystal” cathode materials, which boast enhanced thermal stability to reduce the risk of an electric vehicle catching fire. L&F is looking to produce single crystal cathode material in the existing Daegu facilities beginning 2023.

L&F noted in the filing with the Financial Supervisory Service that the decision is aimed at addressing the increasing demand for high-nickel cathode active materials.

L&F is the second-largest cathode active material firm by sales in Korea, home to rivals EcoPro BM, LG Chem and Posco Chemical. L&F logged 1.4 trillion won in revenue and 114.4 billion won in operating profit in the first half of the year.

The company supplies cathode active materials to Korean lithium-ion cell manufacturers LG Energy Solution, SK On and Samsung SDI. It already runs factories in Daegu and Chilgok County, North Gyeongsang Province.

The share price of L&F, trading on the Korea Exchange, fell 3.3 percent on Monday.