Authorities in Shanghai have accused US Fortune 500 battery maker Johnson Controls and several other companies of emitting excessive amounts of lead blamed for poisoning dozens of children.

The US giant denies a plant it owns was responsible for the pollution in the Chinese city's Kangqiao area, where 49 children, most of them aged between one and three, were diagnosed with lead poisoning in September.

A report posted on the Shanghai government's official microblog page on Saturday blamed three companies for lead pollution and said at least two were directly responsible for the children's condition.

"An investigation found that Johnson Controls expanded its production scale without approval," the government said, adding the plant's lead emissions were excessive.

Two other companies -- Shanghai Xinmingyuan Automobile Parts Co Ltd and Shanghai Kangshuo Waste Recycling Co Ltd -- were also found to be polluting the environment with lead. All three plants have since been shut down.

"The link between children with excessive lead in their blood in Kangqiao and Johnson Controls' lead emissions is quite obvious and there is a definite link with Xinmingyuan's lead emissions," the government said.

Lead poisoning is considered hazardous, particularly to children, who can experience stunted growth and mental retardation.

Fraser Engerman, spokesman for Johnson Controls, denied the link.

"Through our monitoring and analysis of our plant's emissions data, we are confident that the plant was operating well below the levels specified by Chinese environmental regulations," he said in an email to AFP.

"Based on all available facts, Johnson Controls disagrees with any interpretation linking our plant's operation to elevated lead exposure in the Kangqiao area."

The other two companies refused to comment when contacted by AFP.

According to Shanghai authorities, three of the children are still in hospital, but they are getting better.

China's rapid industrialisation over the past 30 years has left the country with widespread environmental damage that has triggered numerous public health scares.

Last year, authorities in the eastern province of Zhejiang detained 74 people and suspended work at hundreds of factories after 172 people -- including 53 children -- fell ill with lead poisoning.