CATL, the world’s largest electric vehicle battery maker, has filed an application for a secondary listing in Hong Kong, in what could be the city’s largest stock offering in years.
The listing of Contemporary Amperex Technology Co, which is a major supplier of Tesla, Volkswagen and other EV makers, has been long awaited in Hong Kong and is expected to be one of the city’s largest share offerings since 2021.
CATL is one of several Chinese companies expected to list in Hong Kong this year, with analysts expecting a $20bn revival in activity — principally from mainland-based companies seeking to expand abroad.
The Shenzhen-listed company has appointed JPMorgan, Bank of America, China’s CICC and China Securities International as lead banks. It also appointed Goldman Sachs, Morgan Stanley and UBS to work on the deal.
The US banks are involved despite CATL having last month been added to a US blacklist of companies deemed to be working with China’s military.
CATL said it was aiming to raise funds in part to boost its international expansion plans, which include building a production site in Hungary. It also plans a joint venture in Spain with Stellantis and a project in Indonesia.
The company redacted several key details from its publicly released prospectus, including the amount of shares it would offer and the precise timetable.
The battery maker said in December it planned to list up to about 5 per cent of its total share capital in Hong Kong, but that underwriters would have the option to increase this slightly based on the market situation.
One person familiar with the matter said that CATL hoped to raise up to $7bn if market conditions were optimal. Morgan Stanley has previously estimated the CATL listing could raise up to $7.7bn.
The surge in Hong Kong listings could boost the city’s reputation as a leading destination for capital raising, after years of thin deal flows. In many cases Chinese companies are looking to list in Hong Kong to raise offshore funds, because tight capital controls can hinder them moving money abroad.
But the recovery in listings may not translate to a boon for Hong Kong’s investment bankers. The FT reported last month that competition from Chinese banks had threatened to depress fees for the CATL listing.
“It is too early to say Hong Kong is back,” Gary Ng, a senior economist at Natixis, told the FT.
The CATL listing “signals that Hong Kong still has advantages for Chinese firms seeking overseas funding”, Ng said, but added that “equity investors remain sceptical of valuations due to decelerating growth in China and geopolitics”.
The offering comes as Hong Kong’s Hang Seng index has rallied by some 13 per cent in the past month amid greater optimism about Chinese technology and electronics stocks after start-up DeepSeek last month overturned assumptions about US supremacy in AI.
CATL said in its heavily-redacted stock exchange filings that Washington’s inclusion of the company on the “Chinese Military Companies” list was “a mistake” and that it was “proactively engaging with [the US defence department] to address the false designation”. It said the designation only stopped it doing business with “a small number of US governmental authorities”.
The company also flagged its exposure to geopolitics, such as the risks of violent fluctuations in China’s currency — including when it would have to convert renminbi to pay dividends in Hong Kong dollars.
CATL has been in the top spot in the global EV battery market for eight consecutive years and had a share of 38 per cent in 2024, according to data from South Korean consultancy SNE Research.
Despite its dominant market position, the battery maker warned of a revenue drop of as much as 11 per cent for 2024, citing lower product prices. CATL said in a Shenzhen stock exchange filing in January that it expected to report net income growth of up to 20 per cent for last year, its slowest pace since 2019.
The company reported revenues of over $50bn in 2023 and has a market capitalisation of some $150bn based on its Shenzhen listing.
