On the evening of September 19, Chinese battery manufacturer Hangke Technology, which is currently listed on Shanghai’s Science and Technology Innovation Board (STAR Market), announced that in order to explore domestic and overseas business and improve its system of lithium equipment, it plans to issue global depository receipts (GDRs) on the SIX Swiss Exchange.
Hangzhou-based Hangke Technology was founded in 1984 and successfully listed on the STAR Market in 2019. The firm provides customers with overall solutions regarding batteries, especially with lithium-ion post-processing battery systems. Hangke’s global customers include Samsung SDI, LG Chem, SKI, CATL, BYD, and EVE Energy.
In the first half of 2022, Hangke achieved operating revenue of 1.955 billion yuan ($279 million), up 81.94% year on year, while the net profit attributable to the parent company reached 241 million yuan, up 90.71% year on year. Its sales revenue in China and overseas markets in the same period reached 1.75 billion yuan and 205 million yuan respectively. Overseas sales revenue also showed a 320% year-on-year increase.
Hangke said in its latest investor research minutes that since the beginning of 2022, the company’s overseas customers exhibit strong demand for production expansion, and its proportion of overseas orders is expected to increase. In terms of overseas layout, the company has set up a wholly-owned subsidiary in Germany and has established a sales team to closely connect with lithium battery enterprises in the European market.
Regarding the purpose of its overseas listing, Hangke said that it hoped to continue to deepen the layout of the world’s main lithium markets, improve its global sales capacity, and increase its penetration in key areas overseas.
Strengthening technical innovation and the level of R&D is also an important consideration for Hangke. The company will build R&D centers in countries with advanced battery technology, and recruit local personnel.
In addition, Hangke will introduce overseas professional investment institutions and industrial investors to further optimize the company’s ownership structure. After the issuance of overseas GDRs, Hangke’s shareholding structure will still meet the listing requirements of the Shanghai Stock Exchange. However, the issuance shall be submitted to the board of directors and regulatory authorities both in China and abroad for approval.
In February this year, China expanded the scope of application of interconnection of depositary receipts business between Chinese and overseas stock exchanges. Overseas, the stock exchange scope was expanded to major European markets such as Switzerland and Germany. With the introduction of this regulation, A-share listed companies began to go public in Switzerland due to its simple issuance and approval process, as well as its investors with sufficient capital and rich experience.
Hangke is following in the footsteps of various other firms from its home country. On July 28, four Chinese companies, including battery makers Gotion High-Tech and Ningbo Shanshan, electronic waste recycling firm GEM, and building materials machinery manufacturer Keda Industrial were officially listed on the SIX Swiss Exchange. According to the Shanghai Securities News, there are more than a dozen listed companies in China preparing to issue GDRs, much more than in previous years.