Evergrande NewEnergy Vehicle Group, the car making arm of China's biggest property developer China Evergrande, announced today that it has raised HK$26 billion ($3.35 billion) through a private placement of 952 million new shares to six investors, raising HK$26 billion ($335 billion) in total.
This is one of the largest equity financings in China's new energy vehicle industry. It's trading at an 8 percent discount to the average closing price over the previous five trading days, with each investor voluntarily locking in for 12 months, the company said.
It is Evergrande's latest move to try to catch up with Tesla, whose shares have jumped nearly 10 times from $92 to $846 since the Shanghai plant went into production early last year.
Evergrande, which is working on 14 new models, revealed in November that it has started trial production in all two production bases in Shanghai and Guangzhou, which means Hengchi mass production has entered the countdown.
At present, Evergrande has already launched six "Hengchi" models, which are expected to be mass-produced in the second half of this year.
According to Evergrande's plan, the total production capacity is planned to be 1 million units/year by 2025 and 5 million units/year by 2035, which is much larger than Tesla.
Evergrande is planning to build three major centers for Hengchi car display and experience, sales, maintenance, and warranty after-sales service, and build a sales network with the help of Evergrande's Fangchebao Group's 21.62 million brokers and over 30,000 offline stores.
Evergrande's share price has rebounded from a low of HK$15 in September last year to HK$29, doubling in 4 months, with a current market capitalization of HK$263.6 billion.
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