Chinese electric-vehicle startup Nio, Inc. NIO rallied strongly in premarket trading on Monday, and its U.S.-listed domestic peers also traded sharply higher.
Shanghai, China-based Nio announced Sunday that strategic investors, including Hefei Jianheng New Energy Automobile Investment Fund Partnership, Anhui Provincial Emerging Industry Investment Co., Ltd. and CS Capital Co., Ltd., have agreed to invest an aggregate of 3.3 billion yuan ($470.64 million) in cash in its subsidiary Nio China. Nio has concurrently agreed to invest 10 billion yuan (about $1.43 billion) in cash to subscribe to the newly issued shares of Nio China.
The strategic investors and Nio will inject cash into Nio China in two installments, with 70% to be made by November and 30% by December.
This would mean a cumulative $1.9 billion investment as Nio expands into the mass market segment with its Onvo brand. The first model to be rolled out under the sub-brand is a smart electric mid-size family SUV named L60 and the first deliveries of the EV began over the weekend.
See Also: Best EV Stocks
Nio’s Chinese peers, namely XPeng, Inc. XPEV and Li Auto, Inc. LI also jumped in premarket trading. The optimism toward these stocks is primarily a function of the copious stimuli China has promised to reinvigorate sagging domestic growth. Reacting to the stimuli hinted by the People’s Bank of China and the Politburo, the Chinese market has been on a tear since the start of last week. On Monday, the Shanghai Composite Index settled up 8.06% to 3,336.50.
In premarket trading, Nio climbed 11.96% to $7.30, according to Benzinga Pro data. XPeng rose 7.94% to $13.73 and Li Auto gained 7.64% to $27.75.
Check out more of Benzinga’s Future Of Mobility coverage by following this link.
Read Next:
Image Via Shutterstock
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
Comments
Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.
