Shares have plunged 31% amid a 7-day losing streak; Nio and XPeng stocks also extend selloffs
Shares of Li Auto Inc. sank Friday to suffer a seventh-straight decline, after the China-based electric vehicle maker's public share offering priced at a discount of more than 10%.
The company said the 47 million share secondary offering of its U.S.-listed stock, which it disclosed before Wednesday's open (), had priced at $29.00 per American depositary share (ADS). That was 10.3% below Thursday's stock closing price of $32.31.
The stock (LI) dropped 5.5% to close at $30.53, as trading volume of 52.0 million shares was well above the full-day average of 36.7 million shares. It has now plunged 30.6% amid a seven-day losing streak, which started after the stock closed at a record $43.96 on Nov. 24. That's the longest losing streak since the stock went public on July 30.
Li Auto raised $1.36 billion from the share offering, and could raise about another $204.5 million if the underwriters exercise all of the options to buy additional shares, granted to cover overallotments.
The company plans to use the proceeds for research and development of next-generation electric vehicle technologies, including ultrafast charging, future car models, autonomous driving technologies and general corporate purposes.
In the two days since the offering was announced, the stock fell 7.3%. If the offering had priced at a 10.3% discount to the Dec. 1 closing price of $34.86, the 47 million ADS offering could have raised $1.47 billion.
Among other China-based EV makers, shares of Nio Inc. (NIO) dropped 5.1% Friday to $43.04, and shed 20.3% last week. XPeng Inc.'s stock (XPEV) declined 5.5% to $30.53 on Friday and tumbled 23.2% for the week.
Also read: XPeng downgraded at UBS, as stock has run up too much to keep buying ().
The pullback in the stocks Friday cames as the iShares MSCI China exchange-traded fund (MCHI) slipped 2.1% last week and the S&P 500 index tacked on 1.7%.
-Tomi Kilgore; 415-439-6400; AskNewswires@dowjones.com
(END) Dow Jones Newswires
December 05, 2020 10:49 ET (15:49 GMT)
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