Zeekr to go public, with China-based EV maker valued at more than $5 billion

By Tomi Kilgore

Zeekr raises $441 million as upsized IPO prices at $21 per American depositary share

Investors will have another way to ride the electric-vehicle sector on Friday, as China-based Zeekr Intelligent Technology Holding Ltd. is set to go public with a market valuation of more than $5 billion.

The company, based outside Shanghai in the city of Ningbo, said Friday that it raised $441 million, as its upsized initial public offering of 21 million American depositary shares (ZK) priced at $21 per ADS.

The pricing was a sign of strong investor demand. Zeekr had previously said it would offer 17.5 million ADSs in the IPO, which was expected to price between $18 and $21 per ADS.

Each ADS represents 10 ordinary shares. With 2.44 billion ordinary shares expected after the offering, the IPO pricing values the battery-electric-vehicle company at about $5.13 billion.

For comparison, U.S.-based EV maker Tesla Inc.’s (TSLA) market capitalization was about $536.3 billion in morning trading Friday, Rivian Automotive Inc.’s (RIVN) was about $9.9 billion and Nikola Corp.’s (NKLA) was about $757 million.

The stock will begin trading on the New York Stock Exchange on Friday under the ticker symbol ZK.

The lead underwriters of the IPO were Goldman Sachs, Morgan Stanley, BofA Securities and CICC.

The company said it plans to use about 45% of the proceeds from the IPO to develop more BEV technologies and expand its product portfolio. Another 45% will be used for marketing and expansion of its charging network. The rest will be used for general corporate purposes.

The company recorded a net loss of 8.26 billion yuan (equivalent to $1.16 billion) on revenue of 51.67 billion yuan ($7.28 billion) in 2023, after a loss of 7.66 billion yuan on revenue of 31.90 billion yuan in 2022.

At the end of 2023, the company had cash and cash equivalents of 3.26 billion yuan ($459.3 million) and inventory valued at 5.23 billion yuan ($736.4 million).

Zeekr’s BEV product line is includes the Zeekr 001, a five-seater crossover hatchback released in April 2021, with deliveries beginning in October 2021.

There is also the Zeekr 009, a luxury six-seater multipurpose vehicle that was launched in November 2022. Deliveries of the Zeekr 009 began in January 2023.

And there’s the Zeekr X, a compact sport-utility vehicle launched in April 2023, with deliveries beginning in June 2023.

Zeekr is going public at a time of lackluster investor enthusiasm in the EV sector and for IPOs. The Global X Autonomous & Electric Vehicles exchange-traded fund DRIV has slipped 2.1% year to date and the Renaissance IPO ETF IPO has edged up 2.1%, while the S&P 500 index SPX has gained 9.5%.

-Tomi Kilgore

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05-10-24 1121ET

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