China Evergrande New Energy Vehicle Group plans to raise HK$3.99 billion (US$516.1 million) by selling new shares to a group of investors that includes Tencent Holdings and Jack Ma-backed Yunfeng Capital. The electric-car manufacturing unit of property developer China Evergrande Group seeks to sell as many as 176.6 million shares to at least six investors in a private placement, Evergrande New Energy Vehicle said in a statement to the Hong Kong exchange on Tuesday. The other buyers included Sequoia Capital and Didi Chuxing, it said. The placement shares will be offered at HK$22.65, representing an about 20 per cent discount on the company’s closing price on Monday, and an 18 per cent discount on its average price over the past few trading days, the statement said. These shares will account for about 2 per cent of China Evergrande New Energy’s enlarged share capital, and the proceeds will be used for general corporate purposes, according to the statement, which did give further details. Shares of China Evergrande New Energy tumbled 11 per cent and closed at HK$25.05 at the close on Tuesday amid concern the value of existing investors’ shares could potentially be diluted by the new stock. The stock had surged 264 per cent through Monday this year, after the company was renamed from China Evergrande Health Industry Group to focus on its electric-car business. It posted a pre-tax loss of 2.68 billion yuan (US$389 million) in the first half of this year, widening a loss of 1.96 billion yuan reported a year earlier . Controlled by Hui Ka-yan, China’s third-richest billionaire, the electric-car unit started building its business in mid 2018 by buying up cutting-edge foreign technology, intellectual property, a battery producer and a distribution network at home and abroad . In August, it unveiled a line-up of six Hengchi models , and plans to start mass production at its mainland China factories in the second half of next year. Hui plans to raise production capacity to between 500,000 and 1 million vehicles a year within three to five years. A recovery in China’s automobiles market, the world’s biggest, from the damage of the coronavirus pandemic has fuelled an upsurge in the market capitalisations of Chinese electric vehicle makers such as NIO, Xpeng, Li Auto and Evergrande New Energy Vehicle. The sales of such vehicles could hit 1.1 million units this year, before tripling by 2025, according to the China Association of Automobile Manufacturers. The local market is currently dominated by Tesla’s Model 3.