- Chinese electric vehicle (EV) startup Zeekr (ZK) has reportedly priced its U.S. initial public offering (IPO) at the high end of the marketed range, with the stock set to debut on Friday.
- The company, which will trade under the ticker symbol ZK, has priced the offering at the top of the expected $18-$21 per share range to raise $441 million, according to sources.
- Despite a brutal price war in China and a slowdown in global EV sales, Zeekr has seen strong demand for its shares, underpinned by its actual vehicle sales and revenue.
Zeekr, a Chinese EV startup, is set to debut its IPO in the U.S. market, pricing its shares at the top of the expected range despite a challenging market environment.
Zeekr’s Strong Position in the EV Market
Unlike many EV startups that have failed to meet investors’ expectations, Zeekr has several things going for it. In 2023, the three-year-old startup delivered 118,685 premium electric vehicles and generated $7.28 billion in revenue, marking a 62% increase from 2022. Despite a loss of $1.16 billion last year, the company’s sales are growing, even outperforming Tesla in parts of China. Zeekr is targeting 230,000 EV deliveries for the full year, roughly double the 2023 tally.
Parent Company Geely’s Support
Another factor contributing to Zeekr’s success is the support from its parent company, Geely. The Chinese car giant, which founded Zeekr as an EV subsidiary in March 2021, is trying to catch up with BYD in electric vehicles. Geely owns several car brands, including Polestar, another high-end EV startup. Both startups can lean on the auto group for resources.
Zeekr’s IPO and Market Valuation
The IPO gives Zeekr a roughly $5.1 billion valuation. For context, Nio has an $8.81 billion market value, after a steep slide since January 2021. Nio delivered 160,038 electric vehicles in 2023. Nio stock gained 2.1% on the stock market today. Among other China EV startups, XPeng rose 3.4% and Li Auto added 1%.
Conclusion
Despite the challenging market environment, Zeekr’s IPO is set to debut on a high note, reflecting strong investor confidence in the company’s growth potential. With its actual vehicle sales and revenue, coupled with the support from its parent company Geely, Zeekr is well-positioned to navigate the brutal price war in China and the slowdown in global EV sales.
