Zeekr, the premium electric vehicle (EV) brand under Chinese automaker Geely, is set to embark on a landmark journey with its US Initial Public Offering (IPO), aiming to secure a valuation surpassing $13 billion. Confidential sources well-versed in the matter have disclosed that the Hangzhou-based manufacturer will engage potential investors across various cities during a rigorous two-week campaign starting from late August. This move comes as Geely, the automotive juggernaut overseeing Zeekr, endeavors to harness favorable financial market conditions to dictate the final size of the share sale, a strategy reminiscent of its subsidiary’s rapid ascent.
Despite numerous overtures for commentary, Geely remains tight-lipped regarding the IPO pursuit. Yet, a precedent exists, with last December witnessing the acknowledgement that Zeekr had, indeed, filed a confidential application for a US IPO. If the forthcoming endeavor reaches fruition, it would reverberate as the most substantial US listing by a Chinese enterprise in over two years, tracing its lineage back to the momentous $4.4 billion raised by ride-hailing titan Didi in 2021.
The assemblage of Zeekr’s fleet showcases a triumvirate of models, their entry-level prices spanning from 189,800 yuan to 499,000 yuan. A recent milestone for the company involved the proclamation of its inaugural luxury sports car earlier this month. With a track record of delivering 72,000 vehicles in the year 2022, Zeekr has set its sights on the ambitious target of 140,000 units for the ongoing year. Beyond borders, the company harbors plans to grace countries such as the Netherlands, Sweden, Israel, and Kazakhstan with its EV offerings, signifying a global ambit.
In a communiqué disseminated earlier this month, Zeekr’s CEO, Andy An, unveiled a remarkable ascent in the vehicle segment’s gross profit margins, positioning them firmly in the double-digit domain during the initial half of 2023. This impressive feat eclipses the aggregate figures amassed throughout the entire year of 2022, constituting more than double the profit margin growth.
The impending Zeekr IPO sets sail amidst a backdrop of evolving dynamics. Recent scrutiny by Chinese regulatory authorities into domestic firms seeking overseas listings has cast a shadow over the valuation of nascent Chinese share sales in the US against this intricate tapestry of market dynamics and regulatory shifts, Zeekr’s IPO looms as a pivotal litmus test for restoring faith in the appeal of Chinese share sales.
As the financial world watches with bated breath, the IPO’s outcome is poised to wield profound influence, not just for Zeekr and Geely, but for the broader landscape of international investment. Market analysts, investors, and industry experts are poised to scrutinize the IPO’s reception, both in terms of investor enthusiasm and market response. The interplay between Zeekr’s ambitious valuation, the ongoing geopolitical considerations, and the shifting financial currents will paint an intriguing narrative for the trajectory of Chinese enterprises on the global stage.
*(Conversion rate: $1 = 7.2883 Chinese yuan renminbi)*
Source: Reuters
