China EV Builder Leapmotor Chasing $1 Bn Hong Kong IPO

Hong Kong, Sept 20 (UrduPoint / Pakistan Point News - 20th Sep, 2022 ) :Chinese electric vehicle manufacturer Zhejiang Leapmotor Technology is hoping to raise more than $1 billion with an initial public offering in what would be the largest debut so far this year for Hong Kong.

The Hangzhou-headquartered company is offering around 131 million shares priced at HK$48-HK$62 ($6.10-$7.90), according to a prospectus filed with the Hong Kong stock exchange on Tuesday.

The listing will be a test of investor appetite in China's EV sector, which has shown huge growth in recent years.

The industry has also so far avoided the kind of sudden scrutiny from regulators that has bedevilled other tech sectors and hobbled profits.

China's electric car market is particularly competitive, with manufacturers jostling to take advantage of an industry boosted in recent months by generous purchase subsidies from local governments.

The Chinese government introduced a string of measures, including a tax break extension, in July to stimulate sales of electric cars against the backdrop of an economic slowdown.

The measures are supposed to support the economy at a time when sporadic Covid-19 lockdowns around the country have dampened consumer enthusiasm and business confidence.

Founded in 2015, Leapmotor focuses on the mid to high-end EV market with a price range of 150,000 to 300,000 Yuan ($21,400-$42,800).

Co-founder Fu Liquan also leads surveillance firm Dahua Technology, one of the world's largest manufacturers of security cameras.

Surveillance industry research group IPVM in 2020 alleged that Dahua developed "discriminatory software" used to track members of the Uyghur minority in China.

Many Chinese EV manufacturers are looking to build an overseas presence and raise capital to fund that expansion.

Hong Kong is a popular listing destination given its proximity to mainland China at a time when Washington and Beijing have clashed over the audit transparency of Chinese companies, some of which have delisted in the United States.

Chinese EV makers XPeng and Nio both forged secondary Hong Kong listings recently.

China's EV market is huge, covering everything from luxury vehicles to more affordable models.

Manufacturer Wuling last year sold 400,000 Mini EV vehicles, a mass market super compact with a price tag of $4,000. The best-selling European electric car is the Renault Zoe, 77,000 of which were sold last year.

XPENG Renault