Chinese Luxury EV Brand Avatr Seeks Hong Kong IPO

On November 28, a luxury electric vehicle manufacturer, supported by a major Chinese automaker, has filed for an initial public offering in Hong Kong.

The funds raised from the IPO are intended for the development of new vehicle models, the construction of a next-generation intelligent platform architecture, expanding branding and sales networks, and increasing working capital, according to a filing submitted to the Hong Kong Stock Exchange yesterday.

The specific amount the company aims to raise has not been disclosed. The IPO will be underwritten by two major securities firms: Citic Securities and China International Capital Corporation.

This seven-year-old automaker began mass production and deliveries in December 2022. It delivered 20,021 vehicles in 2023, 61,588 in the previous year, and 56,729 units in the first half of this year.

Due to rapid sales growth, the company’s revenue doubled to CNY 12.2 billion (approximately USD 1.7 billion) in the six months ending June 30, compared to the same period last year. However, its net loss increased by 11%, reaching CNY 1.6 billion (around USD 226.1 million). Between 2022 and 2024, the company accumulated losses of CNY 9.7 billion. Last year’s revenue was CNY 15.2 billion, representing a 169% increase from 2021.

The company’s ongoing cash burn has been supported heavily by significant shareholder backing. Since its founding, it has raised over CNY 19 billion across four funding rounds, including a CNY 11 billion Series C funding round in December led by the major automaker.

As of June 30, the largest shareholder was the Chinese automaker, holding a 41% stake. The second-largest shareholder is a leading battery manufacturer with a 9.2% stake.

The company is collaborating with a well-known Chinese technology firm and a major battery producer to develop high-end smart electric vehicles jointly.

Though the tech giant is not a shareholder, the two companies maintain strategic equity-level collaborations. In August last year, the manufacturer announced an investment of CNY 11.5 billion to acquire a 10% stake in a Huawei division specializing in smart driving systems.