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Chinese electric carmaker NIO slumps in U.S. debut

Reuters 

(Reuters) - Shares of Chinese Inc fell as much as 15 percent in their market debut, a day after its public offering was priced at the lower end of an expected range, weighed down by investor worries about the prospects of chief rival Inc.

NIO's shares opened at $6 and dropped to a low of $5.35, giving the company a market capitalization of $5.52 billion.

The company, whose pure-electric, seven-seat sport-utility vehicle is seen as a rival to Tesla's Model X, priced 160 million shares at $6.26 on Tuesday, just above the low end of its $6.25 to $8.25 target price range, raising $1 billion.

Tesla's struggles to meet its production targets and an abandoned attempt by to take it private have weighed not just on its own stock, but also on peers looking to develop mass-market electric cars.

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

The listing - the third-biggest in the by a Chinese firm this year - comes as Chinese EV makers seek fresh capital to develop new products and in areas including autonomous driving and

Having begun promoting EVs in 2009, aims to become a as it bids to curb vehicle emissions, and promote

Several EV makers such as and have also raised funds from heavyweight investors including Alibaba Group Holding Ltd, and Tencent.

NIO, founded by Chinese in 2014, incurred a net loss of $502.6 million in the first six months of 2018 on $6.95 million in revenue.

The company began customer deliveries of its in June and plans to launch a second, lower-priced electric sport-utility vehicle, the ES6, by the end of this year.

Goldman Sachs, and led the IPO. Lynch, Credit Suisse, Citigroup, and were also part of the process.

(Reporting by in Bengaluru; Editing by Sriraj Kalluvila)

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Wed, September 12 2018. 20:36 IST
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