China Aviation Lithium Battery (CALB), Chinese EV battery the country’s third-largest electric vehicle (EV) battery maker, has raised HK$9.9 billion (US$1.26 billion) from its initial public offering, after pricing the shares at the bottom of the marketed range.
The Jiangsu-based company offered the shares at between HK$38 and HK$51 apiece, and settled for floor price after gauging investor demand, according to a Hong Kong exchange filing on Wednesday. The proceeds will still rank the CALB IPO as the third-largest in the city this year after China Tourism Duty Free raised US$2.1 billion in August and Tianqi Lithium’s issue generated US$1.7 billion in July. ), Chinese EV battery , CALB only managed to sell 21 per cent of the shares allocated to Hong Kong investors, pushing the unwanted 10.4 million shares to global investors, the filing showed. Recent IPOs by Chinese EV maker Zhejiang Leapmotor Technology and property services group Onewo also suffered from weak take-up rates in the city, leading to steep losses on their first day of trading. The battery manufacturer reported year-on-year sales growth of more than 100 per cent for three consecutive years from 2019 to 2021 amid a boom in battery-powered car sales in China, the world’s largest automotive and EV market. CALB, which received approval for its IPO on September 8, posted a net profit of 111.5 million yuan (US$15.6 million) in 2021, turning around from a loss of 18.3 million yuan the previous year.
The company was co-founded in 2015 by a unit controlled by Aviation Industry Corp of China, the state-owned conglomerate that makes fighter jets for the military and owns about 10 per cent of CALB. The company counts carmakers Guangzhou Automobile Group, Chongqing Changan Automobile and Zhejiang Leapmotor among its customers. Leapmotor raised about US$800 million in its Hong Kong IPO on September 29. Unlike Tianqi Lithium, ), Chinese EV battery , the Chinese lithium ore miner and EV battery maker, which is listed in Shanghai and Hong Kong, this is CALB’s first public listing. The successful fundraising by CALB will give a much-needed boost to Hong Kong’s flagging IPO market. The city ranked as the fourth-largest listing venue globally for the first nine months of this year, according to Refinitiv. Tianqi Lithium is one of the 15 cornerstone investors, buying HK$768 million worth of shares. EV maker Xpeng Motors and smartphone manufacturer Vivo Mobile Communication are two other cornerstone investors. Huatai International is the sole sponsor for the deal. The brokerage, along with Citi, Credit Suisse and JPMorgan, is also the joint global coordinator.
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