HONG KONG/BEIJING -- U.S.-listed Chinese electric vehicle makers Li Auto Inc., Nio Inc. and Xpeng Inc. plan to list in Hong Kong as soon as this year, tapping a growing investor base closer to home, said people with direct knowledge of the matter.
Each aims to sell at least 5 percent of enlarged share capital in the Asian hub, the people said. Based on their New York market capitalization on Monday, proceeds could reach $5 billion.
The companies have been working with advisers on the sales which could begin as early as midyear, said one of the people, who declined to be identified due to confidentiality constraints.
Li Auto, Nio and Xpeng -- which have raised $14.7 billion in U.S. markets since 2018 -- declined to comment. U.S.-listed shares of the three automakers rose between 3.7 percent and 5.3 percent in early deals.
The plans come as the three companies increase capital-raising efforts to fund technology development and expand sales networks in China, the world's biggest EV market where U.S. rival Tesla Inc. is boosting sales of its China-made vehicles.
This year is set to be crucial for EV makers to seize market share as the industry expects China sales of new-energy vehicles to jump almost 40 percent from last year to 1.8 million units.
"Despite much richer financial resources now compared with a year ago, EV startups still need to invest heavily in next-generation technology," said analyst Shi Ji at Haitong International. "Exploring a secondary listing much closer to their home market, if any, is a good move."
Selling shares in Hong Kong would also add the trio to a slew of New York-listed Chinese firms seeking a presence on more local exchanges amid Sino-U.S. political tension.
The rising number of such listings "has enhanced the status of Hong Kong's capital markets globally, and also helped issuers reach higher valuations and raise more capital," said Zhang Zihua, chief investment officer at Beijing Yunyi Asset.