JP Morgan analyst Nick Lai released on Friday a note commenting NIO‘s decision to be listed on Singapore SE after being included in the Hong-Kong SE earlier this year. The decision will have a “limited fundamental impact on NIO’s operations in the near term”.
“This, in our view, in a similar move to that in March when NIO had a secondary offering on the HKSE and the shares trading on the HKSE are fully fungible with ADRs in the US. The move to list in Singapore provides an alternative venue for future capital raising if needed in our view.”
“Strategically, as NIO gradually expands its footprint to international markets (thus far, Europe), the company believes Singapore will also be an important regional hub considering its robust international financial system” — the analyst concluded. Lai reiterated his stance of preferring OEMs with vertically integrated business models, like BYD and Guangzhou Auto, as initially reported by Street Insider.
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One day after being added to HFCAA list, NIO announced on Thursday evening (EST) the proposed secondary listing of its Class A ordinary shares on the Main Board of the Singapore Exchange Securities Trading Limited. The Company’s American depositary shares (the “ADSs”), each representing one Share, will continue to be primarily listed and traded on the New York Stock Exchange (the “NYSE”).
After the approval received on February 28th, NIO shares started being traded on the Main Board of The Stock Exchange of Hong Kong on March 10. After XPeng and LI Auto listing during the last summer, also NIO is now trading on SEHK and the stock code “9866” regarding its first models: EP9, ES8, EC6 and ES6. NIO stock opened in HKSE at 160 HKD, $20.46 USD.
On Wednesday evening, US SEC updated the Holding Foreign Companies Accountable Act (HFCAA) list adding NIO, XPeng and 80 other Chinese companies. According to the law approved in late 2020, the companies on the list used an auditor “whose working paper cannot be inspected or investigated completely by the PCAOB”. Previously, on April 22, also the Chinese automaker LI Auto was added to the HFCAA list.
NIO Official Comment
NIO has been actively exploring possible solutions to protect the interest of its stakeholders. On March 10, 2022, the Company completed a secondary listing of its Class A ordinary shares on the Main Board of the Hong Kong Stock Exchange (the “HKEX”) under the stock code “9866.” The Class A ordinary shares listed on the HKEX are fully fungible with the ADSs listed on the NYSE.
NIO will continue to comply with applicable laws and regulations in both China and the United States, and strive to maintain its listing status on both the NYSE and the HKEX in compliance with applicable listing rules.