China’s electric car maker Xpeng Motors today got approval from the Hong Kong Stock Exchange for a dual primary listing and will launch an IPO, reported Reuters, citing sources with direct knowledge of the matter.
After going public in the US last August and rising about $1.5 billion, Xpeng is now planning to raise at least $2 billion in Hong Kong according to CNBC. The company is currently listed on the New York Stock Exchange with a market value of more than $30 billion.
With primary listings on both the HKEX and NYSE, Xpeng will have to follow requirements and regulations in both HK and the US, adhering to each exchange’s rules.
Analyst says issuing new stocks in Hong Kong is meant as a way to exploit the close connections between mainland China and Hong Kong, which could help the company reach quality investors in the mainland, the Wall Street Journal reported.
Investors can use the Stock Connect regime to buy shares in the company as early as six months after listing, according to HKET.
Founded in 2014, Xpeng has become one of the fastest developing EV makers in China. According to Tencent Securities, Xpeng Motors delivered 5,686 units in May, a 483% year-on-year rise growth. Its total revenue reached 2.95 billion yuan, growing more than six times compared with last year.
A report released by the Association of Automobile Manufacturers (CAAM) earlier this month shows that the retail sales of new energy cars in May increased by 177%, and also predicts that sales of new EV this year will reach 2.4 million units.
But the firm also faces mounting pressure in China’s increasingly crowded electric car market. EV giant Tesla delivered 21,936 to its customers in May, still holding a large share in the national electric vehicle (EV) market. Other local start-ups such as Nio and Li Auto Automobile have also been listed in the US and show strong growth.
Xpeng is actively promoting its smart vehicles to attract customers. The company today announced a three-year-long sponsorship deal with NBA China, preparing more promotional activities and co-branding partnerships during tournaments.