Chinese EV battery giant CATL aims to raise $5.2b in Hong Kong IPO

HONG KONG – Chinese EV battery giant CATL aims to raise US$4 billion (S$5.2 billion) in its Hong Kong listing scheduled for May 20, said a statement filed to the bourse on May 12, making it the largest initial public offering (IPO) expected in the city so far in 2025.

A global leader in the sector, Contemporary Amperex Technology – commonly known as CATL – produces more than a third of all electric vehicle (EV) batteries sold worldwide, working with major brands including Tesla, Mercedes-Benz, BMW and Volkswagen.

The company is already listed in Shenzhen, and its plan for a secondary listing in Hong Kong was announced in a filing in December with the stock exchange.

According to a prospectus filed on May 12, CATL will offer approximately 117.9 million units priced at up to HK$263 a share for total expected proceeds of HK$31.01 billion (S$5.2 billion).

Founded in 2011 in the eastern Chinese city of Ningde, CATL was initially propelled to success by rapid growth in the domestic market.

But the world’s largest EV market has more recently begun to show signs of flagging sales amid a broader slowdown in consumption.

The trends have fuelled a fierce price war in China’s expansive EV sector, putting smaller firms under huge pressure to compete while remaining financially viable.

But CATL continues to post solid performances, with its net profit jumping 32.9 per cent in the first quarter.

Funds raised from a secondary listing could be used to accelerate CATL’s overseas expansion, particularly in Europe.

The battery giant is building its second factory on the continent in Hungary after launching its first in Germany in January 2023.

In December 2024, CATL announced that it will work with automotive giant Stellantis on a US$4.3 billion factory to make EV batteries in Spain, with production slated to begin by the end of 2026.

CATL is also planning to limit the types of US investors that can participate in its Hong Kong listing, an indication that US-China tensions may be spilling into the IPO market, Bloomberg reported on May 11.

CATL decided to switch the share sale solely to a so-called Reg S offering that does not allow sales to US onshore investors and exempts the issuer from certain US regulatory filing obligations, people familiar with the matter told Bloomberg last week.

While most large US institutional investors also have offshore accounts, meaning they can still participate, the move will exclude some, such as domestic mutual funds with retail money. It is unusual for such a large share offering in Hong Kong not to be available to onshore US investors.

CATL decided on the change to limit its exposure to US legal liability, according to people familiar with the matter. It has enough demand even if some US investors are unable to participate in the listing, the sources added, asking not to be identified as the information is not public.

The battery maker has already found itself caught up in geopolitical tensions between Washington and Beijing. CATL was included on a Pentagon blacklist in January, citing the company’s alleged links to the Chinese military.

CATL has said the allegations are without merit and that it has never engaged in any military-related business or activities. 

A US congressional committee in April called on the two lead US banks working on the listing, Bank of America and JPMorgan Chase & Co, to withdraw from the deal, citing concerns including the blacklist. Both firms are still working on the transaction, Bloomberg has reported. AFP, BLOOMBERG