Batteries to power Sanyo profits

Sanyo has been investing in making more efficient solar cells

Sanyo Electric has announced plans to concentrate resources on its most profitable areas - solar cells and rechargeable batteries.

Sanyo is the world's largest rechargeable battery maker and powers 40% of the mobile phones worldwide.

It is in the middle of a restructuring programme after suffering three years of losses, an accounting scandal and earthquake damage to a chip plant.

Sanyo also said it hoped to double its operating profit by March 2011.

Sanyo has earmarked 350bn yen ($3.2bn; £1.6bn) to invest, of which 70% will go on facilities for rechargeable batteries, solar cells and electronic parts.

The company's turn around is also making an impact on its earnings, and Sanyo predicts net profits of 20bn yen this year, compared with last year's loss of 45.4bn yen.

It added that it aims to lift sales of rechargeable batteries and solar cells by 50% to 600bn yen in the next three years.

Sanyo shares closed 8.5% higher on the Tokyo stock exchange.

The firm is being helped in its restructuring plans by Goldman Sachs, which was one of three banks that bought 300bn yen of Sanyo shares last year as the company and its creditors tried to shore up its finances.