Shares in CATL, the world’s largest maker of batteries for electric vehicles (EVs), soared about 17% Tuesday in its Hong Kong trading debut after it raised about $4.6 billion in the largest initial public offering (IPO) globally this year.
The solid reception of Chinese company Contemporary Amperex Technology Co. (CATL) in Hong Kong suggests there is still an appetite among international investors for leading Chinese manufacturers despite trade tensions between Beijing and Washington.
It sold more than 135 million shares at their maximum offer price, 263 Hong Kong dollars ($33.6) each. Its shares rose after they started trading at 296 Hong Kong dollars ($37.80), 12.5% higher than their offer price. They were up about 17% by midafternoon local time.
CATL also has shares listed in Shenzhen, a business hub neighboring Hong Kong. They initially fell but then edged 0.9% higher on Tuesday.
CATL held a nearly 38% global market share for EV batteries in 2024, its listing documents showed. It supplies automakers like Tesla, Volkswagen, BMW, Mercedes-Benz, Ford, Toyota and Honda.
The company has faced pressure from the U.S. In January, the U.S. Defense Department added it to a list of companies that said they had ties to China’s military, an accusation that CATL denied. It has called the inclusion a "mistake."
In April, John Moolenaar, chairperson of the U.S. House Select Committee on China, wrote to the CEOs of JPMorgan Chase & Co. and Bank of America to demand that the two American banks withdraw from their work on CATL's IPO. But the two banks stayed on.
In the U.S., Ford Motor Co. is licensing technology from CATL to build batteries, but the plan faces resistance from some Republican lawmakers, who have expressed concern that the Chinese company could benefit from U.S. tax dollars.
Because the U.S. has listed CATL as having ties to the U.S. military, the share offering was excluded from onshore U.S. investors. However, many large U.S. institutional investors have offshore accounts that allow them to participate.
The company said it plans to use most of the net proceeds from the IPO to build its factory in Hungary, meant to bring it closer to the manufacturing facilities of its main European customers.
Government officials, including Hong Kong’s Financial Secretary Paul Chan, attended its gong-striking ceremony on Tuesday in the city’s vibrant business district, Central. The company's chairman, Robin Zeng, said his business is committed to becoming a zero-carbon technology company.
"Listing in Hong Kong means we are more broadly integrated into the global capital markets, and it’s also a new starting point for us to promote the global zero-carbon economy," Zeng said.
CATL recorded a profit of 55.3 billion yuan ($7.6 billion) in 2024, up 16.8% from 2023. Its listing surpassed JX Advanced Metals’ $2.9 billion IPO in Japan in March, which was previously the largest this year, according to Renaissance Capital, a provider of pre-IPO research and IPO-focused ETFs.
