Chinese battery giant CATL enjoyed a bumper listing in Hong Kong on Tuesday, which raised the company $4.6 billion – and the total sum could top $5 billion.
Shares of the electric vehicle battery maker reached HK$318.40 – 18% above its HK$263 subscription price – and listing was the world’s largest so far this year.
That helped Hong Kong’s Hang Seng Index rise about 1.5% by the close of trading.
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CATL, which is also listed in Shenzhen, raised $4.6 billion in its Hong Kong offering, which was the largest listing in the city since Midea Group raised the same amount last year. CATL’s Shenzhen stock was down about 0.5% on Tuesday.
Listing helps revive HK bourse
CATL’s deal means $7.73 billion has been raised in Hong Kong through initial public offerings and second listings so far in 2025, compared to $1.05 billion at the same time last year, according to LSEG data.
Bonnie Chan, CEO of bourse operator Hong Kong Exchanges and Clearing, said more than 40 firms listed in mainland China, known as A-share companies, were actively exploring Hong Kong listings.
“One major advantage for these companies to pursue a listing in Hong Kong is the fact that would open up an offshore fund-raising platform for us to support their offshore expansion plan,” Chan said at CATL’s listing ceremony at the stock exchange.
Wang Shuguang, a member of China International Capital Corp’s (CICC) management committee who oversees investment banking, said CATL’s listing could help revive Hong Kong’s capital markets. CICC was a sponsor of the CATL listing alongside JPMorgan, Bank of America and China Securities International.
“This is a further demonstration that domestically-listed leading industrial companies can be well-recognised by global investors in the Hong Kong offerings. This will also help the Hong Kong market become more active,” he said.
The institutional tranche of the Hong Kong deal was oversubscribed 15.2 times, according to CATL’s filings, while the retail portion was 151 times oversubscribed.
Money will pay for factory in Hungary
The company said most of the funds would be used for the construction of a factory in Hungary, part of its plan to make batteries in Europe for automakers such as BMW, Stellantis, and Volkswagen.
China’s biggest electric vehicle maker BYD is building its first factory in Europe in Szeged, in southern Hungary, while CATL is building one of the continent’s biggest electric battery plants in Debrecen, in eastern Hungary. The battery plant is due to start production later this year, according to a report by Hungary Today.
“This listing means our wider integration into the global capital market and a new starting point for us to promote the global zero-carbon economy,” CATL founder and chairman Robin Zeng said at the listing ceremony.
CATL had aimed to raise about $4 billion in the listing but increased the size of the deal following the strong demand from investors.
A so-called “greenshoe option” can be exercised that would take the size of CATL’s raising to $5.3 billion.
At that size, it would be the largest listing in Hong Kong since Kuaishou Technology raised $6.2 billion in 2021, according to LSEG data.
Boost from trade truce
CATL’s book-build had been open for a day when the US and China announced a brief truce in the trade war that had roiled global financial markets since early April.
The move created some extra momentum for CATL, whose book-build had been already covered with pre-commitment orders when the deal launched last Monday, according to two sources with direct knowledge of the book-building process.
The tariffs pause prompted some global long-only investors who had previously not bid for CATL stock in the Hong Kong listing to place orders, they added.
CATL did not respond to a request for comment.
The company has been extending its lead in the electric vehicle battery market with a 38% share globally in 2024. That increased from 36% a year ago, according to data from SNE Research.
The demand for CATL shares was driven by an increasingly positive sentiment towards China from global investors that had started to emerge since the start of the year despite the tariff war, according to the sources.
They said a decision to restrict US onshore investors from buying CATL stock did not dent the demand for the shares.
US investors with offshore accounts could still participate and some did so despite CATL being placed on a US Department of Defense blacklist in January of companies accused of working with the Chinese military.
CATL said in its Hong Kong listing documents it was working with US authorities to have the “false designation” removed.
- Reuters with additional input and editing by Jim Pollard
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