Business World

Li Auto: Chinese electric automaker plans secondary listing of shares in Hong Kong stock market to raise $2 billion

Chinese electric automaker Li Auto announced plans of raising about $2 billion in a secondary listing of its shares in Hong Kong.

The Tesla rivals’ stock are already traded on the Nasdaq stock market in New York.

Li Auto is the latest Chinese company to raise money closer to its home country in recent months.

The move comes as Chinese firms listed in the US face increasing scrutiny by Beijing and Washington.

The six-year old Chinese start-up said it would issue 100 million shares in the Hong Kong initial public offering (IPO) at a maximum price of $19.3 per share.

The firm, which is also known as Li Xiang, said it will offer 10 million shares to Hong Kong investors, with the balance made available to people around the world.

Final pricing of the shares is due to be announced before the end of this week.

The Beijing-based company raised almost $1.1 billion through its Nasdaq listing a year ago.

On Sunday, Li Auto said it delivered 8,589 of its Li One vehicles in July, a monthly record for the firm.

The Li One is the company’s only model currently on the market. It is a plug-in hybrid which has a fuel tank to charge the battery and extend its range although the petrol engine does not directly drive the car’s wheels.

The strong sales numbers come even as a recovery in vehicle sales is threatened by the global chip shortage that has forced many car makers around the world to suspend production.

Secondary listings in Hong Kong are becoming increasingly popular amongst Chinese companies as they try to protect themselves from the fallout of the friction between Beijing and Washington.

On Friday, Wall Street regulator the Securities and Exchange Commission said it will now require extra information from Chinese companies aiming to sell shares in the US.

The announcement came as Beijing intensified oversight of Chinese companies with share listings in the US, as well as tightening its grip on technology and education firms at home.

In recent years several technology giants including Alibaba, NetEase and have opted to take out secondary listings in recent years.

Last month, one of Li Auto’s competitors Xpeng raised about $1.8 billion with a secondary listing of its shares in Hong Kong.