Geely Auto files prospectus for Shanghai STAR Market listing

Shanghai (Gasgoo)- Geely Automobile Holding Limited (Geely Auto) is ready to become China's first carmaker listed on China's Nasdaq-style sci-tech innovation board, also known as the STAR market.

(Photo source: Geely Automobile)

The automaker announced on September 1 that it has filed for the issuance of A shares (or RMB ordinary shares) on the STAR Market to Shanghai Stock Exchange and the latter has confirmed the handling of the application.

According to the prospectus Geely Auto unveiled at the same time, the initial number of RMB shares to be issued shall not exceed 1,731,666,448 shares with par value of HK$0.02 each, representing not more than 15% of Geely Auto's issued share capital.

The automaker plans to raise 20 billion yuan ($2,933,196,000) from the RMB share sale on STAR Market. After deducting the issuance expenses, the proceeds of the RMB share issuance are expected to be used for the R&D of new automobile products, the R&D of prospective technologies, the industrial acquisition, and the replenishment of working capital, according to the prospectus.

According to Geely Auto's semi-annual financial results, the company gained 36,819,775,000 yuan ($5,399,980,838) in revenue for the first-half of 2020, posting a year-on-year decrease of 23% mainly due to the lower sales volume and the production disruption caused by the partial lockdown in most areas of China in early 2020.

During the same period, the profit attributable to the equity holders slumped 43% from a year ago to 2,296,753,000 yuan ($330,887,003). The basic earnings per share for the first six months stood at 0.2473 yuan, versus 0.4439 yuan for the year-ago period. Diluted earnings per share (EPS) were down 44% to 0.247 yuan.

Geely Auto's financial performances were below the management's expectations as its sales volume in the first half of 2020 was adversely affected by the outbreak of COVID-19 pandemic.

Geely Auto and its subsidiaries sold a total of 530,446 new vehicles (including the sales volume of Lynk & Co vehicles) in the first six months, representing a 19% year-on-year decline. Of those, 510,873 units (-17%) were sold in domestic market and 19,573 units (-49%) were exported to overseas markets.