Alibaba Spins Off Banma for Hong Kong IPO to Boost Smart Car Ventures

August 21 – The leading Chinese e-commerce conglomerate plans to spin off a prominent provider of smart vehicle operating systems for a listing on the Hong Kong Stock Exchange, aiming to improve its funding prospects.

Funds raised through the initial public offering will be directed toward enhancing research and development efforts in smart cockpit technologies to increase domestic market share and expand internationally. Additionally, the proceeds will support acquisitions and other growth initiatives, according to the company’s prospectus filed yesterday. The specific funding target was not disclosed.

Deutsche Bank, China International Capital Corporation, and Guotai Junan International will serve as co-sponsors for the IPO.

The company was the largest supplier of automotive smart cockpit solutions in China by revenue last year. Its systems were installed in over 2.3 million vehicles in 2024, showcasing a compound annual growth rate of 67 percent over the past three years, according to the filing.

Despite rapid expansion, the company remains unprofitable due to fierce price competition within China’s automotive sector. Last year, it reported a net loss of approximately CNY 847.4 million (USD 118.1 million), a slight 3 percent improvement from the prior year. Revenue declined by 5.5 percent to CNY 823.8 million.

The parent company, based in Hangzhou, retains nearly 45 percent ownership and will hold over 30 percent after the spinoff and public listing, according to a statement issued today. The owner of major online retail platforms had already excluded the unit from its consolidated financial statements late last year.

The independent listing is expected to boost the company’s visibility among customers, suppliers, and potential partners, as well as expand access to external financing. This move should also enhance its capabilities for equity investment, debt issuance, and bank loans, the parent company noted.

Founded in 2015 as a joint venture between the tech giant and one of China’s largest automakers, the company specializes in developing automotive operating systems. In 2020, the parent increased its investment and integrated its proprietary AliOS platform, securing a controlling stake in the firm.

Published by: Emmi Laine