Shanghai Electric Corp. announced plans for an initial public offering (IPO) of China’s largest supplier of offshore wind turbines, which licenses Siemens Gamesa technology for its machines.

Shanghai Electric will split off its Shanghai Electric Wind Power (SEWP) unit and offer “not more than 40% equity” of the subsidiary to strategic investors on China’s Nasdaq-style sci-tech ‘Star Market’, according to a release to the Shanghai Stock Exchange.

SEWP is by far the largest offshore wind turbine supplier in the country, accounting for almost 44% of the market in 2018. It ranked fifth in China for wind turbines installed in that year.

The IPO's timeline or fundraising target has yet to become clear, but Shanghai Electric said it plans to use cash raised supporting its wind turbine R&D and after-sales services, as well as upgrading production lines.

The announcement coincided with SEWP this week installing China’s first 8MW turbine, based on Siemens Gamesa technology that the group licenses from the western OEM.

In the first three quarters of last year, the firm registered a profit of 100m yuan ($14.4m), bouncing back from a 52m yuan loss in the 2018 fiscal year, thanks to “a series of positive policy factors”, the filing also reveals.

Most wind OEMs in China reported significant year-on-year growth in revenues or profits, amidst a wind installation dash linked to the rapid changes applied to the renewable feed-in tariff (FIT) scheme in the country, as Recharge previously reported.

SEWP also has the development rights to 9.5GW of offshore wind projects in China’s Guangdong province, among some 49GW new developments approved by the end of 2019.

The firm is researching its own 10MW design and is the turbine supplier to a demonstration floating wind project off Shanghai.

The Chinese government launched the trial Sci-tech Innovation Stock Board, dubbed a Nasdaq rival, to focus on high-tech industries with major growth potential. The SEWP case will be the second demerger of a state-owned firm to seek an IPO on the index.