Geely to raise 20 billion yuan on STAR market

Geely Automobile Holdings aims to raise over 20 billion yuan on Shanghai's Nasdaq-like STAR market, with most of it to be spent on new models and technologies, according to its prospectus released on Tuesday.

Geely, which is already listed in Hong Kong, has filed an application for a public share sale on the bourse for high-tech and innovative companies.

Its debut would represent the first for any carmaker on the STAR market. Geely said it would also use some of proceeds to finance mergers and acquisitions and replenish working capital.

Geely has hired China International Capital Corp and Huatai United Securities as underwriters for the listing.

As China's largest private carmaker, Geely reported revenue of 36.82 billion yuan ($5.3 billion) and net profit of 2.32 billion yuan for the first half of 2020, down 23 percent and 43 percent respectively year-on-year, because of the impact of the novel coronavirus.

In the first six months, Geely sold 530,446 vehicles, down 19 percent year-on-year. However, its sales ranked first among Chinese brands. Its market share has increased from 6.51 percent at the beginning of this year to 6.74 percent currently.

Geely is targeting full-year sales of about 1.32 million vehicles, down 3 per cent from 2019, helped by a second-half recovery in demand after the easing of coronavirus lockdowns.

The carmaker said it will speed up the introduction of new vehicles, especially new energy vehicles, to consolidate its leading position in the Chinese auto market.

"Our new product launches will be at a high level in coming years and offer enough power to maintain our long-term growth," Geely said.

According to its plan, Geely will launch six models in the second half of this year. It launched three new models in the first half of 2020.