Li Auto stock sinks to 7th straight loss, after public share offering prices at 10% discount



Li Auto Inc.

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,
-5.51%

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,
-5.09%

dropped 5.1% Friday to $43.04, and shed 20.3% last week. XPeng Inc.’s stock
XPEV,
-4.79%

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,
+0.05%

slipped 2.1% last week and the S&P 500 index
SPX,
+0.88%

tacked on 1.7%.

Elsewhere, shares of Kandi Technologies Group Inc.
KNDI,
-0.87%

eased 0.9%, and plummeted 41.3% this week; Geely Automobile Holdings Ltd.
GELYY,
+3.42%

gained 3.4% Friday and BYD Co.
BYDDY,
+2.71%

tacked on 2.7%.



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