China EV maker revs up for US$1b IPO in HK

Bloomberg and staff reporter

Hozon New Energy Automobile, a company making affordable electric vehicles in China, is considering filing for its US$1 billion (HK$7.8 billion) Hong Kong initial public offering as soon as this month, say people familiar with the matter.

The Shanghai-headquartered company has added ABC International and China Merchants Bank International to the banks working on the listing, the people said, asking not to be identified as the information is not public.

China International Capital Corp, Citic Securities and Morgan Stanley are among the other banks on the first-time share sale, Bloomberg News reported last year.

Deliberations are ongoing and details such as the timing and bank lineup could still change.

An IPO may come as the Chinese EV market is being roiled by a price war kicked off by Tesla in October, with both domestic and international rivals following suit.

Steep discounts have failed to reverse a slide in sales for most manufacturers, and earnings have taken a hit.

Hozon sold 152,073 units of its Neta brand vehicles in 2022, up 118 percent from the year before, said a press release. The company is looking to build a presence in Europe and the Middle East as well as in Asia Pacific, where it inked a manufacturing agreement in May to make its Neta V model in Thailand.

The EV maker raised more than 3 billion yuan (HK$3.3 billion) in a series D funding round in 2022, its website said. Shenzhen Capital Group and Qianhai Fund of Funds were among those taking part in the round.

This came as BYD (1211) said its sales volume of new energy vehicles in May soared 109 percent to 240,200 units from a year ago,

The total sales volume in the first five months jumped 97.6 percent to about one million units from a year earlier, said a filing yesterday.

Meanwhile, Zeeker a premium EV brand under Geely Automobile (0175), said it delivered 8,678 vehicles in May, up 100 percent year on year.

Separately, Black Sesame Technologies, a developer of artificial intelligence chips and systems for cars, is reportedly looking to submit an application in June to list in Hong Kong that could raise up to US$300 million.

The firm backed by Xiaomi (1810) is said to be working with CICC and Huatai International on preparations for the share sale.