China's Xiaomi Corp announced that it has successfully raised $5.5 billion through an upsized share sale as it advances its electric vehicle manufacturing plans. The company sold 800 million shares at HK$53.25 each, according to its statement to the Hong Kong Stock Exchange.
Initially planning to sell 750 million shares, Xiaomi opted to increase the offering during the bookbuilding process. The final price was set towards the lower end of the expected range of HK$52.80 to HK$54.60 and reflects a 6.6% discount compared to its closing price of HK$57.
The funds raised will be allocated to accelerate business expansion and enhance research and technology development. Xiaomi, the world’s third-largest smartphone maker, launched its EV manufacturing venture last year with the introduction of the SU7 sedan, after primarily focusing on smartphones, household appliances, and smart gadgets for 15 years.
In its recent report, Xiaomi revealed a nearly 50% increase in fourth-quarter revenue and raised its electric vehicle delivery target for the year to 350,000, up from 300,000. The EV business generated 32.1 billion yuan ($4.4 billion) in revenue for 2024, with over 135,000 SU7 sedans delivered. The company aims to begin overseas shipments by 2027.
Additionally, Xiaomi has acquired a 52-hectare (128.5 acres) plot in southern Beijing, slated for the third phase of its auto factory as it enhances its annual shipment goals. The company is also set to invest approximately 7-8 billion yuan of its 30 billion yuan 2025 research and development budget into AI, as stated by President Lu Weibing.
Xiaomi's capital raising is part of a broader trend of tech-focused financing from Chinese firms in Hong Kong, taking advantage of a favorable sentiment towards the tech sector following a meeting with President Xi Jinping and top tech leaders last month, signaling a potential easing of prior government scrutiny.
Prior to Xiaomi's share sale, Chinese companies had engaged in $16.8 billion worth of equity capital market activities in the first quarter, more than double the amount from the same period last year.