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WM Motor sold 44,152 EVs last year, more than doubling its 2020 output. Photo: Handout

Baidu-backed EV firm WM Motor applies to list in Hong Kong, may raise US$1 billion

  • WM Motor’s filing on Wednesday did not disclose the amount of funds it hoped to raise, but Bloomberg reported in November that it was targeting about US$1 billion
  • EV companies can attract investors, as the sector is up and coming, analyst says
Baidu-backed Chinese electric vehicle (EV) start-up WM Motor Holdings has applied to raise funds in a new listing in Hong Kong, according to a stock exchange filing, becoming the latest such carmaker to list in the city.
WM Motor’s filing with the exchange on Wednesday did not disclose the amount of funds it hoped to raise or a timeline, which are expected to be announced at a later stage, but Bloomberg reported in November last year that the EV firm was targeting raising about US$1 billion in a Hong Kong initial public offering (IPO).

“EV companies can attract investors, as the sector is up and coming. The country is keen on cutting carbon emissions and the new-energy carmakers will have a lot more room to grow,” said Louis Wong, executive director of Phillip Capital Management (Hong Kong). “EVs are expected to grow to represent about 20 per cent of the total car sales in China in the near future.”

Shanghai-based WM Motor will join the ranks of EV peers Leapmotor Technology, XPeng, Li Auto and Nio, all of which have either applied to list or are already listed on the Hong Kong exchange, the world’s largest IPO market seven times in the past 13 years. Hangzhou-based Leapmotor applied in March this year to raise capital through a Hong Kong IPO. Its application is being vetted by the bourse’s listing division currently.

Freeman Shen Hui, the founder and chairman of Shanghai-based WM Motor. Photo: Handout

WM Motor was founded by Freeman Shen Hui, its chairman, in 2015 and has sold a total of 83,495 EVs across five models since the launch of its first model in September 2018. Last year alone, it sold 44,152 EVs, more than doubling its 2020 output. Its total revenue reached 4.7 billion yuan (US$701.8 million), an increase of 77.5 per cent over 2020.

Its two manufacturing facilities in Zhejiang and Hubei provinces have an aggregate maximum annual production capacity of 250,000 units. The lockdown in Shanghai over the past two months had led to the closure of more than 20 showrooms between March and May.

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“Despite the ongoing global shortages and price increases for chips and battery cells, and the impact of the Covid-19 pandemic, we experienced strong growth in EV sales volume during the track record period (2019-2021) by leveraging our leading technologies and high operational efficiency,” WM Motor said in its filing.

EV firms have grown thanks to generous government subsidies in China, the world’s largest market for such cars. Competition, however, is fierce. “We face intense competition in China’s passenger vehicle market, and demand for EVs may be cyclical and volatile,” WM Motor said in the filing.

Shen and his wife currently own 30.82 per cent of the company and are its largest shareholder. WM Motor’s other backers include property developer Agile Group, which owns 6.46 per cent, while search engine giant Baidu has 5.96 per cent, according to the filing.

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WM Motor is also partnering with Baidu on Project Apollo, one of the world’s largest and most diversified open autonomous driving alliance platforms, which was set up by Baidu in 2017.