EV Firm NIO Sets Sights on Singapore IPO

Shanghai-based electric vehicle firm NIO successfully listed on the Hong Kong Stock Exchange (HKEx) through introduction on Thursday. In addition, according to its related prospectus disclosed at the end of February, the company has applied to the main board of the SGX (Singapore Exchange Limited) for a second listing by way of introduction. After this, it may become the first among China’s new generation of leading automakers to be listed in three places simultaneously.

According to the prospectus, NIO‘s specific listing date for the SGX is now under review. The company said that its primary listing locale will remain in New York.

For its recent IPO in Hong Kong, NIO said in the announcement that “this listing is not for raising funds, because its funds are sufficient at present.” However, according to AI Caijing, in the eyes of the industry insiders, the firm’s decision to complete listings in several locations  confirms its desire to expand its sources of funding. The move to prepare for a listing in Singapore, they contend, offers definitive proof.

In fact, facing the uncertainty of market competition, NIO‘s demand for capital is still apparent. According to financial data, as of September 30, 2021, the company’s cash reserves totaled about 47 billion yuan ($7.43 billion). Correspondingly, by the end of 2021, the number of employees working at the company had exceeded 15,000, an increase of 95.9% compared with that of 2020. The company’s expenditure in terms of R&D in the third quarter was 1.19 billion yuan ($188.1 million), an increase of 35.0% from the previous quarter. The accumulated R&D expenditure in the first three quarters exceeded 2.7 billion yuan ($426.9 million). It is estimated that the company’s annual R&D investment will be 5 billion yuan.

Not only that, the company’s sales volume has declined for several months. On March 1, the company released related data, showing that the delivery volume in February was 6,131 vehicles, up 9.9% year-on-year – but compared with 9,652 vehicles in January, it still declined significantly.

In response to the decline, Li Bin, Chairman and CEO of NIO, responded that it was mainly due to a delay in resuming work by Chinese regulatory bodies, as well as the effects of counter-pandemic actions that limited the delivery progress. Li said that the factory had resumed work since mid-February and has started to increase its production capacity.

SEE ALSO: Chinese EV Maker NIO Debuts in Hong Kong

In terms of NIO‘s present product planning, the firm will launch the ET7, ET5 and ES7 in succession to further enrich its product types. In addition, the company still maintains a high level of investment in its infrastructure this year. As for its stores, the company will open more than 100 “NIO Houses” and “NIO Spaces” in 2022. In terms of power station replacement, by the end of this year, the cumulative number of power exchange stations operated by the company will exceed 1,300, which means that nearly 600 more will be additionally built on the basis of more than 770 stations counted at the end of last year.