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Chinese EV manufacturer Xpeng looks to raise $1.1 billion in U.S. IPO

Electric Vehicles are definitely the future of automobiles. Due to this reason, many companies seeing the potential of the market are entering into the EV business. Similarly, the Chinese EV manufacturer Xpeng entered the market in 2018 with its electric SUV. Now, the company aims to expand its business in the US and is looking to raise $1.1 billion in IPO.

Chinese EV manufacturer Xpeng

Image Source: CleanTechnica

The company aims to raise money by selling 85 million ADS between 11 USD and 13 USD per share. The Chinese EV giant has been estimated at around $9.17 billion.

Investors in the company Xpeng

Xpeng has a lot of top-level existing investors like Alibaba(the largest e-commerce site in China), cotaue, and Qatar investment. These companies have shown interest in buying $200 million, $100 million and $50 million of ADS respectively.

Xiaomi, the best selling smartphone brand in India, has also shown interest in the company. Reportedly, it showed interest in buying $50 million ADS. Alibaba seems to be in roots with the company. Having purchased all class c ordinary shares, it has over 14.9% of the company’s voting power.

What is the growth potential of EVs?

The Electric vehicles markets are multiplying and have a vast potential to become multiple times in future. Kathleen Smith, Principal, Renaissance Capital, provider of institutional research and IPO ETFs, said:

“Investors can’t seem to get enough exposure to electric vehicle stocks. We are comparing Xpeng with Li Auto, which went public in July and is up 28% from its IPO and to Nio,”

Reports say that China’s automobiles sales have started to increase after the drop due to COVID-19. The government is also showing full support in EV manufactures and extended subsidies to Electric vehicles until 2022.

Chinese EV manufacturer Xpeng

Image Source: Splitvolt

The Chinese EV manufacturer Xpeng debuted in 2018 with its Xpeng g3 model. The company launched the SUV at an affordable $20,000. If Xpeng continues to produce vehicles that are cheap and good, then it has the potential to give competition to US EV companies.

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