This is XPeng's second ABS offering in the domestic capital market, further diversifying its direct financing channels on China's two major exchanges.
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XPeng Motors announced today that it has completed its latest ABS (asset-backed securities) issuance of nearly RMB 1 billion in Shanghai, following a similar move by the company in Shenzhen earlier in the year.
XPeng's subsidiary, Guangzhou Xiaopeng Automotive Financial Leasing Co Ltd, has successfully completed the RMB 964 million ($134 million) ABS offering on the Shanghai Stock Exchange, according to an announcement today.
This is XPeng's second ABS issuance in the domestic capital market and its first in Shanghai after its first ABS issuance on the Shenzhen Stock Exchange earlier this year, further diversifying its direct financing channels on the two major exchanges in China.
The RMB 805 million senior A tranche ABS issuance has a debt rating of AAA, a coupon rate of 2.80 percent and an expected maturity date of September 13, 2024.
Another RMB 39 million of senior B tranche ABS has a debt rating of AA+ and a coupon rate of 3.00 percent with an expected maturity date of November 14, 2024.
These rates are lower than XPeng's ABS offering in Shenzhen earlier in the year, as financing costs in China are declining. The current benchmark one-year loan prime rate (LPR) in China is 3.65 percent and the 5+ year LPR is 4.3 percent.
The successful financing highlights investors’ recognition of XPeng’s carbon neutrality and ESG (Environmental, Social and Governance) initiatives, as well as its ongoing commitment to sustainability, the company said.
On September 27, XPeng received an MSCI ESG rating of AA for the year 2022, its third consecutive annual AA rating by MSCI ESG Research, ranking top among carmakers worldwide for ESG performance.
On February 22, XPeng announced that Guangzhou Xiaopeng Automotive Financing Lease Co Ltd has issued RMB 775 million of ABS for carbon-neutral projects on the Shenzhen Stock Exchange.
The RMB 624 million senior A tranche ABS had a AAA debt rating and a coupon rate of 3.00 percent. The RMB 31 million senior B ABS had a debt rating of AA+ and a coupon rate of 3.50 percent.
XPeng's local counterpart, NIO, has also previously issued similar assets in China to diversify its direct financing channels.
On October 29, 2021, NIO Financial Leasing Co Ltd, a subsidiary of NIO, issued an ABS with a size of RMB1.03 billion on the Shanghai Stock Exchange.
On March 3 this year, NIO Financial Leasing Co Ltd issued RMB 1.03 billion ABNs (Asset Backed Medium-term Notes) in China's interbank market.