(Bloomberg) — Jinko Solar, one of the world’s largest panel producers, fell as much as 12% after outlining plans to raise 9.7 billion yuan ($1.3 billion) for a manufacturing facility, underlining the sector’s continued need for significant investment in new plants.

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The proposed stock offering by the company’s Jiangxi Jinko unit is equivalent to about 8% of the parent company’s market capitalization, according to analyst BOCI Research Ltd. Tony Fay. Jinko said in a statement that the proceeds will be used for activities including the construction of a facility in Shanxi.

The drop in Tuesday’s trading comes even after Jinko reported a 325% first-half profit jump as lower raw material costs helped the sector cut prices and stimulate demand. Shanghai-listed Jinko shares were trading down 12% as of 11:20 a.m. local time, the largest intraday drop ever.

Solar manufacturers have seen their value drop over the past 12 months despite booming demand for panels. Investors have raised questions about competition in the industry and about the frequent need to finance plant projects to expand capacity or improve technology.

Jinko’s fundraising announcement on Monday followed a separate 10 billion yuan convertible bond issue that was completed earlier this year. Dennis Ipp, an analyst at Daiwa Capital Markets, said the equity financing plan’s total of 19.7 billion yuan against a market capitalization of about 110 billion yuan caused investors to back off.

“It is expected that this will lead to a significant share reduction in the company in the future,” Ip said via email.

The Bloomberg Intelligence Global Solar Theme Peers Index, which includes Jinko and major competitors such as Longi Green Energy Technology Co. and Trina Solar Co. , up 19% this year.

Read more: China’s solar energy sector accelerates past record high in 2022

Jinko is expanding its manufacturing footprint and aims to have more than 12 gigawatts of solar wafer, cell and module production capacity in Southeast Asia by the end of 2023, Jinko said Monday in an earnings release. The company also plans to build a plant in Florida capable of producing About 1 gigawatt per year of advanced panels.

The strategy aims to meet demand and is also designed to bypass trade barriers for Chinese producers, including in the United States.

Sales reached 31 GW of solar modules in the first half, with more than 60% sold outside of China. The producer anticipates shipments for the full year of up to 75 gigawatts, and indicated forecasts that sales across the industry are likely to pick up through the rest of the year.

Major projects have begun and construction has begun in China. Chairman and CEO Xiande Li said in a statement that lower prices for modules have also fueled demand for modules in some overseas markets.

Net income jumped to 3.84 billion yuan in the six months to June 30, from 905 million yuan in the same period a year earlier.

(Updates from first paragraph with lower stock count.)

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