Chinese EV Maker Li Auto Wins Nod For Hong Kong Listing

(Bloomberg) — Chinese electric vehicle manufacturer Li Auto Inc. has been given the go-ahead from the Hong Kong Stock Exchange to list in the city, following in the footsteps of its rival XPeng Inc., which completed such a share sale last month.

US-traded Li Auto could fetch $1 billion to $2 billion in listing, according to those in the know. The updated listing documents were published on the HKEX website on Monday, indicating it has received approval from the exchange.

A company spokeswoman said the company would not comment beyond the prospectus.

Li Auto continues with a stock sale in the Asian financial center at a time when Beijing is cracking down on foreign listings by Chinese companies. Shares of some of the largest US-listed Chinese companies have fallen recently as concerns over the regulatory attack mounted. Li Auto’s Nasdaq shares fell 8% on Friday, giving the company a market cap of $27.4 billion.

New rules

Earlier this month, China proposed new rules that would require nearly all companies seeking to list abroad to undergo a cybersecurity assessment, a move that will significantly tighten oversight of its internet giants.

Li Auto becomes the second of the trio of US-traded Chinese EV companies seeking listing in Hong Kong. XPeng raised $2 billion in a dual primary listing last month. Like XPeng, Li Auto has been public for less than two years, meaning it cannot pursue a secondary listing like other Chinese companies that have completed the so-called homecoming stock sale.

Li Auto raised $1.3 billion in its IPO in the US about a year ago. Shares are up 163% from the bid price as part of a global rally in EV stocks.

Shares of EV makers have made a comeback since bottoming out in mid-May, as investors bet on growing demand for electric cars. Growing competition from old automakers and greater caution against risky assets had made last year’s rally sputter.

Goldman Sachs Group Inc. and China International Capital Corp. are joint sponsors for Li Auto’s listing in Hong Kong, while UBS Group AG is the financial advisor, according to the prospectus.

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