China’s EV company XPeng Inc. prepares to repeat the striking recent success of rival Li Auto (Nasdaq: LI) on Thursday in an initial public offering worth up to $1.1 billion.
Alibaba-backed XPeng is scheduled to lift off on August 27 on the New York Stock Exchange under the ticker symbol “XPEV.” Its American depositary shares, in the amount of 85 million, will be priced at $11 to $13 apiece, according to the prospectus filed Friday with the U.S. SEC.
The underwriters may purchase an additional 12.75 million ADSs upon the public offering.
The company also said that four of its existing shareholders, Alibaba (NYSE: BABA; HKEX: 9988), Coatue, Qatar Investment Authority and Xiaomi (OTC: XIACF; HKEX: 1810), have expressed interest in acquiring a cumulative $400 million of the ADSs offered. A new potential investor, Primecap Management Co., may acquire an additional $100 million of the shares, the filing said.
Underwriters are Credit Suisse Securities (USA) LLC, J.P. Morgan Securities LLC, and BofA Securities Inc. Co-managers are ABCI Securities Co., BOCI Asia, Futu Inc (Nasdaq: FUTU), Haitong International Securities Co., and Tiger Brokers (NZ).
Based in Guangzhou, China’s auto manufacturing hub, XPeng sells two smart electric vehicles, the G3 and P7. The latter, a sports sedan P7, can run 439 miles on a single charge. As to the G3, an SUV, according to research by the IHS Markit, the company said in its filing that the G3 was among the top-three best-selling electric SUVs in China in 2019.
XPeng's target consumer is China's mid- to high-end segment, with prices on their vehicles ranging from 150,000 yuan to 300,000 yuan.
Next year, XPeng plans to release its third smart electric car, a sedan, as well as the next version of XPILOT – the 3.0.
For the first half-year, XPeng reported $141.9 million in revenues, down 19% from the same period in 2019. Net loss narrowed 59% year-over-year to $112.6 million. In the full year 2019, XPeng generated revenues of $328.5 million on losses of $522.5 million, according to the filing.
XPeng said it delivered 2,451 smart EVs in July, or 1,641 P7s and 810 G3s.
XPeng's IPO closely follows a highly successful listing of Li Auto, which sells the Li ONE six-seater smart electric SUV. The company raised $1.1 billion in IPO on July 30, priced at $11.50 per American depositary share, and soared nearly 40% upon debut. On Friday, LI shares closed at $15.02 per ADS.
Li Auto’s listing, as well as the upsized $2.12 billion debut of Chinese real estate platform KE Holdings Inc. (Nasdaq: BEKE) in mid-August, demonstrated continued strong interest among U.S. investors for Chinese stocks despite the threat from Washington to tighten foreign listings procedures.