Tesla’s Chinese Rival Xpeng Makes Hong Kong Debut

Chinese Tesla rival Xpeng made its market debut in Hong Kong on Wednesday, with shares rising 1.8% at the open to 168 Hong Kong dollars.

The electric vehicle maker issued 85 million Class A ordinary shares at a price of 165 Hong Kong dollars each, raising 14.02 billion Hong Kong dollars, or $1.8 billion.

The company is known for its P7 sedan and G3 SUV and delivered 6,565 vehicles in June, representing a 617% increase year-on-year and a monthly record.

Xpeng is already listed in the U.S and like many Chinese companies listed on Wall Street, they will have a secondary listing, usually in Hong Kong.

Xpeng’s share offering is a dual-primary listing, meaning it will be subject to the rules and oversight of both U.S. and Hong Kong regulators. This is not the case with a secondary listing.

The company said last month that it would price shares at no more than 180 Hong Kong dollars each.

The U.S. Securities and Exchange Commission adopted rules that impose stricter auditing requirements on foreign firms listed in the U.S. earlier this year.

“I would say our Hong Kong listing is a very strategic decision. In it, I think obviously, you know, hedging against geopolitical risks is only one of the considerations,” Brian Gu, president of Xpeng, said to Emily Tan of CNBC.

“But in the long run though, we would like to have a listing venue that get us closer to home because we’re a consumer brand in China. Ultimately we want our customers to be our shareholders, and having the dual primary listing status in HK (Hong Kong) will give us eligibility to be connected to Chinese capital markets.”

This week Beijing said it will step up supervision of companies listed overseas with the country’s government planning to improve rules around cross-border data flows and security.

Disclaimer: We have no position in any of the companies mentioned and have not been compensated for this article.