Demand for electrolytic capacitors, of which high-purity aluminium foil is a main component, has been growing in China for use in consumer electronics and automobiles.
Showa Denko plans to install an additional kiln and increase the rolling process at its Sakai plant in Osaka Prefecture by the end of 2013.
This upgrade at the company's sole facility for making high-purity aluminum foil is expected to increase its monthly capacity for that product to 3kt from 2kt.
It also plans to build a factory in China by June 2013 to cut, heat-treat and handle other final processes for producing foil for the Chinese market.
The total investment for upgrading the Sakai facility and constructing the Chinese factory is estimated at JPY4.5bn ($59.5M).
Aluminium electrolytic capacitors are now used widely in electric appliances, including LCD TVs, air conditioners, refrigerators, and LED lighting.
They are also used in energy-saving devices for inverters; PCs and other IT equipment; parts for electric vehicles and plug-in hybrid cars; and in the area of renewable energies, such as wind energy and photovoltaic power generation.