An Xpeng P7 electric car can be seen during the 18th Guangzhou International Automobile Exhibition at the China Import and Export Fair Complex on November 20, 2020 in Guangzhou, Guangdong Province, China.
VCG | Visual China Group | Getty Images
GUANGZHOU, China – Shares in US-listed electric vehicle maker Xpeng rose on its debut in Hong Kong on Wednesday.
Xpeng issued 85 million Class A common shares at a price of 165 Hong Kong dollars each. Those stocks opened at $ 168 Hong Kong, up 1.8%.
The electric car maker is already listed in the US Usually, Chinese companies that are listed on Wall Street will do what is known as a secondary listing, mostly in Hong Kong. Here a company that is listed on one exchange sells shares in another.
But Xpeng’s stock offering is a dual primary listing. This means that it is subject to the rules and supervision of both the US and Hong Kong regulators, which is not the case with a secondary listing.
The electric automaker said last month it would price the shares at no more than HK $ 180 each. Xpeng had gross proceeds of Hong Kong dollars 14.02 billion (US $ 1.8 billion).
Chinese companies listed in the US have tried to list themselves in Hong Kong to hedge against tensions between China and the United States.
Earlier this year, the US Securities and Exchange Commission passed regulations that impose stricter audit requirements on US-listed foreign companies. These requirements pose the risk of delisting companies that violate the regulations.
“I would say our listing in Hong Kong is a very strategic decision. I think geopolitical hedging is just one of the considerations in this,” said Brian Gu, president of Xpeng, to Emily Tan of CNBC.
“In the long run, however, we would like to have a stock exchange that brings us closer to home as we are a consumer brand in China. Ultimately, we want our customers to be our shareholders and have double the primary exchange status in HK (Hong Kong) us the right to be connected to the Chinese capital markets. “
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But even Chinese companies that are listed in the USA could be subjected to an audit at home. Beijing announced on Tuesday that it would step up supervision of overseas listed companies. The government plans to improve the rules for cross-border data flow and security. The move comes after regulators conducted a cybersecurity review of ridesharing company Didi and forced app stores to remove it from download days after it went public in the US.
Xpeng, known for its P7 sedan and G3 SUV, delivered 6,565 vehicles in June – 617% more than last year and a monthly record. The Guangzhou-based company delivered 17,398 vehicles in the second quarter of the year, above its own forecast.
In April, the automaker launched its third production model, the P5 sedan, as competition increased from rivals such as Li Auto, Tesla and Nio.