Chinese electric carmaker NIO recovers from bumpy U.S. debut
Shares of Chinese electric carmaker NIO Inc
NIO shares were up about 1 percent at $6.30 in afternoon trading, giving it a market capitalisation of $6.46 billion.
The rebound in shares was a welcome relief for NIO, whose offering came under pressure as investors have turned wary about electric carmakers due to struggles at its chief rival Tesla Inc
Investors have worried about Tesla`s cash-burn rate as the company struggles to meet its production targets amid its efforts to become a mass-market automaker.
NIO began deliveries of its ES8 SUVs in June and in August sold 1,121 units. The company plans to launch a second, lower-priced electric sport-utility vehicle, the ES6, by the end of this year.
NIO, founded by Chinese entrepreneur William Li in 2014, incurred a net loss of $502.6 million in the first six months of 2018 on $6.95 million in revenue. It has $677 million in cash and cash equivalents as of June 30.
The listing - the third-biggest in the United States by a Chinese firm this year - comes as Chinese EV makers seek fresh capital to develop new products and finance investments in areas including autonomous driving and battery technologies.
NIO, formerly known as NextEV and backed by Chinese tech heavyweight Tencent Holdings Ltd , is one of several largely Chinese-funded EV startups betting on the benefits of local production to compete with firms such as Tesla.
Having begun promoting EVs in 2009, China aims to become a dominant global producer as it bids to curb vehicle emissions, boost energy security and promote high-tech industries.
Several EV makers such as WM Motor Technology Co and Xpeng Motor have also raised funds from heavyweight investors including tech giants Alibaba Group Holding Ltd
Goldman Sachs, JPMorgan and Morgan Stanley led the IPO. Bank of America Merrill Lynch, Credit Suisse, Citigroup, Deutsche Bank and UBS were also part of the process.
(This article has not been edited by Zeebiz editorial team and is auto-generated from an agency feed.)
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