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Chery Holdings Co., Ltd. is considering listing its auto division in Hong Kong, which could value it at about $7.1 billion (50.221 billion yuan), according to several media reports. It is reported that Chery is seeking bank support to help with the company's initial public offering (IPO), and discussions are continuing, and details such as the exact size of the IPO may change.

In response to the above news, Chery Automobile officials have not yet responded to the above news.

In fact, this is not the first time Chery has been IPO. Prior to this, the news about Chery IPO has been concerned by the industry, Chery has also made a lot of efforts, but ultimately failed to list for a variety of reasons. As early as in 2004, there was news that Chery planned to go public, when the Anhui provincial government urged Chery to list for financing, but the listing plan was stranded at the end of the year. In 2007, at the launching ceremony of Chery's 1 million new cars, Chery Chairman Yin Tongyue said that Chery would start the listing financing plan as soon as possible, but it came to nothing in the end.

When the time came in September 2022, at the conference of Chery Xingtuo Yaoguang, Chery Chairman Yin Tongyue said: "Chery wants to complete the IPO by 2025." In December last year, there were also media reports that IDG Capital was considering buying Chery holding Group shares from existing shareholders at a price of up to 7 billion yuan, and Chery Automobile, a subsidiary, would also consider submitting an IPO application as early as 2024 at a valuation of 150 billion yuan. In response to this news, Chery Automobile responded that it was indeed preparing to go public, but the rest of the information was not accurate.

According to the data, Chery holding Group Co., Ltd. was founded in 1997 by the automobile manufacturing industry. Its subsidiary Chery Automobile is the earliest independent car brand with more than one million sales in China, and it is also a small number of state-owned vehicle enterprises that have not yet been listed in China. At present, Chery Holdings has automotive, shipbuilding, finance, tourism and other business sectors, among which, Chery holding passenger car business plate is mainly composed of Chery Automobile, EXEED Star, Jetta, Chery Jaguar, Chery Land Rover, Kaiyi and other brands, its products cover entry-level to luxury products, Chery Automobile is the most important source of sales of Chery Holdings.

The latest figures show that in the first nine months of this year, Chery Group sold 1.7528 million vehicles, up 39.9 percent from the same period last year, accounting for 93 percent of the total sales in 2023. Among them, Chery sold 1.1135 million vehicles, up 33.1 percent from the same period last year, accounting for 63.53 percent of the total sales. As a reference, Chery Group sold 1.8813 million vehicles in 2023, of which exports accounted for half of the total sales, and exports accounted for 937100 vehicles in 2023, accounting for about half of the total sales.

Judging from the sales situation in the past two years, the overall sales growth of Chery Group is particularly rapid, and Chery does have a certain market imagination. However, it should be noted that great changes have taken place in the position of Chinese cars in the international market, especially in the new energy vehicle sector, but at present, Rui Group relies more on miniature pure electric vehicles in the field of new energy. there is not much layout in the middle and high-end areas, and there is still a tendency to lag behind, which means that Chery Group urgently needs to make more efforts in the field of new energy vehicles. "how to create popular models in the field of new energy" is a subject that needs to be considered and remedied.

It is worth mentioning that car building itself is a high-input industry, especially in the era of new energy, the iterative speed of technology and models is very fast, and R & D usually requires a huge investment. In addition, if you want to develop in the longer term, you need to expand the scale, which also means that more funds are needed to continue to invest. Therefore, listing has become the only way for car manufacturing enterprises. After all, the biggest advantage brought by listing is access to financing channels, and access to financial support, listing financing has naturally become a shortcut for car companies to become bigger and stronger. Industry insiders believe that if Chery IPO goes well, it may be able to bring more resources and financial support. Of course, listing is not the end, invest in research and development, create brand personalization, and ensure product quality is the top priority for car companies to survive in the highly competitive market.

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