Author | Family Office Magazine
On March 10, under the pressure of US stock delisting, after two difficult Hong Kong IPO applications, NIO finally officially landed on the Hong Kong Stock Exchange, with the stock code "9866" and the opening price of HK$160 on the first day. As of press time, the market capitalization fell to HK$214.1 billion.
After the listing of Weilai Automobile in Hong Kong, it once again aroused the attention of the outside world to car manufacturers in the capital market. In particular, the discussion of the Hong Kong stock market of automobile companies has begun to become more and more intense. Everyone can't help but have a question: Will Hong Kong stocks become a gathering place for new car-making forces? Can Hong Kong stocks become a financing port for new car-making forces? Is it possible for Hong Kong stocks to become a springboard for new car-making forces to return to the domestic capital market?
Why are Hong Kong stocks "optimistic" about Weilai?
This time, WEILAI Automobile was listed on the Hong Kong Stock Exchange in the form of "introduction", and did not raise funds, and the company's stock price rose to HK$169.5 on the first day of listing, and then fell sharply.
Compared with other car companies in Hong Kong, THE MARKET VALUE OF NIO's listed stock price and market value found that the market value of NIO Isu Motors is 2 times that of Great Wall Motors, 3.2 times that of GAC Group, and 2 times that of Geely Automobile.
Why is the Hong Kong capital market optimistic about NIO?
1. Weilai Automobile's own performance has excited the Hong Kong stock market. In 2021, NIO delivered 91,429 new vehicles throughout the year, an increase of 109.1% year-on-year. In February 2022, 6,131 smart electric vehicles were delivered, an increase of 9.9% year-on-year. In 2022, NIO plans to deliver three new models, and the number of models on sale will increase from three to six.
2. As an offshore market, the geographical advantage with the mainland has led to the Impact of the Hong Kong stock market on the Mainland. Nio's Hong Kong stock listing is also to get close to China's local investment market. Under the background of strict approval of A-shares and science and technology innovation boards, Hong Kong stocks will be taken as a place to live. Therefore, NIO is favored by mainland investors in the Hong Kong stock market.
3. NIO's new car attributes have led to a conceptual advantage in competition with other Hong Kong-listed auto companies. In addition, due to the return of US stocks to Hong Kong stocks, under the support of the market value of US stocks, the value of Weilai Automobile in the Hong Kong stock market will not be too ugly.
Since the beginning of this year, Weilai's performance in the US stock market has been falling and bottoming out, especially the increasingly fierce economic competition between China and the United States, and the United States once sang the decline of Chinese stocks. Experts believe that the overall valuation of new energy vehicles in the Hong Kong stock market is higher, so the performance of Nio's Hong Kong stocks is expected to be better than that of US stocks. However, experts pointed out that whether Weilai, which continues to lose money, can continue to be favored by the market depends on when it can turn losses into profits.
It is worth noting that NIO's listing in Hong Kong coincided with the rise in oil prices caused by the Russian-Ukrainian war, which brought unlimited potential to new energy vehicles, which also indicates that new energy vehicles ushered in a window of surge.
The unspeakable secret of Weilai's "introduction to listing"
NIO's Hong Kong stock listing adopted the "introductory listing" approach, with Morgan Stanley, Credit Suisse and CICC as joint sponsors of the IPO.
Different from the traditional listing model, the special feature of introducing the listing is that there is no public offering link, but the shareholders apply for the listing of the old shares. According to the prospectus, Li Bin, founder and CEO of WEIO, holds 10.6% of the shares and has 39% of the voting rights; Tencent holds 9.8% of the shares and has 17.4% of the voting rights; and Baillie Gifford & Co holds 6.5% of the shares and has 3.5% of the voting rights.
Nio is the first Chinese stock to land in Hong Kong in the form of an introduction in the form of an introduction. Since the introduction of the listing does not issue new shares to the shareholders of the new market, there is no pre-set issue price, the price at the beginning of the listing of the enterprise is determined by the market, and the opening price will be used as the benchmark for calculating the rise and fall of the stock price thereafter.
Why use the "introductory form" to go public?
According to previous media reports, NIO submitted a listing application in Hong Kong in March 2021, but it was slow to obtain approval from the Hong Kong Stock Exchange, mainly because it involved the issue of user trust shareholding.
According to NIO's 2019 announcement, Li Bin, founder, chairman and CEO of NIO, established THE NIO User Trust with 50 million shares under his name. In a public filing to introduce the listing in Hong Kong, NIO said that its user trust principal company is NIO Users Limited, which has 1.1% of the issued Class A common shares and voting rights, and will own 22.2% of the Class C common shares and voting rights. Li Bin is the founder, regulator, investment adviser and sole actual beneficiary of the company.
The operation of setting up a user trust has aroused the attention and inquiries of the Hong Kong Stock Exchange, which has caused weilai automobile to be stranded on the Hong Kong stock exchange in 2021. As a last resort, WEIlai had to use the method of "introducing listing" to list on the Hong Kong Stock Exchange for the second time and did not raise funds to be successfully listed.
Hong Kong stocks or the gathering place of new forces of car manufacturing
The successful listing in Hong Kong not only reduces the development impact caused by geopolitical factors for WEILAI Automobile, but also obtains a channel for its next financing. Since 2020, auto companies have done little in the capital market. The stock market, in particular, seems extremely unfriendly to new cars that are in urgent need of financing.
Carding found that the new car-making forces were full of confidence in the domestic listing in the early stage, and initially set their sights on the science and technology innovation board, hoping to break the encirclement of Wei Xiaoli's US stock listing in one fell swoop. Unfortunately, with the tightening of the approval of the Science and Technology Innovation Board, strict accountability measures have been taken against the intermediary institutions recommended for listing, resulting in Geely, Weima and other car companies withdrawing from the approval of listing on the Science and Technology Innovation Board.
Subsequently, FF gained experience in the U.S. stock market through the backdoor model, which once again provoked the nerves of the new car-making forces. Aichi and other companies once prepared for the SPAC model to land in the US stock market, unfortunately, the US stock market also closed the door to this backdoor method, and the US stock listing was not over.
After the Didi U.S. stock incident, under the influence of geo-economic influence, "Wei Xiaoli" U.S. stocks and Chinese stocks have planned to choose a safe haven for funds. In this context, the dual effect of US car companies returning to Hong Kong stocks and mainland car companies coveting Hong Kong stocks has begun to appear
Xiaokang shares temporarily suspended the Listing Plan of Hong Kong stocks
Incomplete statistics in 2021, in addition to the zero-run cars, Nezha Motors and WM Motors of the new car-making forces, even Xiaokang, which cooperated with Huawei, was once preparing for the Listing in Hong Kong. Although these companies are not small in terms of technology and development stages, the story logic and financing model and the previous round of Wei Xiao