After successfully going public in the United States, Jike started a continuous rise in its stock price.
On May 13th, Eastern Time, the stock price of ZK. NYSE continued to rise, rising more than 13% during the day, and finally closed at $29.04 per share, with a total market value of $7.19 billion (approximately RMB 52 billion), just one step away from XPEV. NYSE. On the previous trading day, Jike Intelligent Technology Holdings Limited (hereinafter referred to as "Jike") was officially listed on the New York Stock Exchange, gathering with Weixiaoli on Wall Street.
If calculated from the date of establishment, Tesla took 7 years on the road to IPO, while Wei Xiaoli took 4 years, 6 years, and 5 years respectively. From its brand launch on April 15, 2021, to knocking on the door of the US stock market, Jike, which took only 37 months, has been dubbed by the outside world as the "fastest IPO in history" new force in the automotive industry.
"This IPO is strategic," said An Conghui, President of Geely Holding Group and CEO of Geely Krypton Intelligent Technology, at a communication meeting after ringing the bell. "Geely Krypton is a global brand that faces the global market from birth, global capital, users, and technology. The United States is a gathering place for global capital, and we are optimistic about new energy vehicles. This strategy determines our long-term orientation, and we cannot just look at the valuation and price of the IPO.". This can enhance the transparency of global management and better participate in global competition.
After making a stunning debut in the US stock market, there have been more trust votes and a surge in supply, standing at a new starting point for the marathon. In this era where big fish eat small fish, but fast fish eat slow fish, Extreme Krypton, which is still running hard, has promising growth potential in the future.
On the first day of listing, the stock price skyrocketed and investors became enthusiastic
On its first day of listing, Jike staged a booming market and can be called the "new darling of capital" on Wall Street.
On the first trading day of May 10th, Extreme Krypton opened at $26, skyrocketing by 40% from its offering price during the trading session, with the highest price approaching $30. As of the close of the day, the stock price was at $28.26, an increase of 34.57%, and the market value reached $6.867 billion. On May 13th, the stock price of Extreme Krypton continued the explosive trend of the previous trading day, rising by over 13% during the day. As of the close, the stock price has reached $29.04, with a total market value of $7.19 billion.
In fact, the enthusiasm of investors can be seen in the extreme subscription stage. On May 8th prior to this, Jike had already ended its subscription one day earlier, and at that time the company had received nearly five times the oversubscription.
Subsequently, due to oversubscription, Extreme Krypton expanded its IPO size by issuing a total of 21 million American Depositary Shares (ADSs, each corresponding to 10 ordinary shares) at a price of $21 per share, raising approximately $441 million. If the underwriters exercise their over allotment rights, the issuance size will further expand to 24.15 million ADSs, raising approximately $507 million. The underwriters for this issuance mainly include 12 well-known institutions, including Goldman Sachs, Morgan Stanley, BofA Securities, and CICC.
In the eyes of the outside world, Jike's listing this time is the largest US IPO of Chinese concept stocks since July 2021, excluding the SPAC model listing. This means that it is the largest conventional IPO in the past three years.
The long-term investment value of Extreme Krypton is also highly recognized by its original investors. Ningde Times and Mobileye, as partners in the industry chain and existing investors, continue to subscribe in this IPO. They are both investors and excellent partners in the ecosystem of the Jike industry, optimistic about the long-term value of Jike. As early as its first year of establishment, Jike received strategic investments from numerous star companies, including Intel Capital, CATL, and Bilibili.
Behind the two consecutive gains: strong fundamentals and high growth potential
Extreme Krypton's entry into the fastest IPO of new energy vehicle companies in history, as well as the underlying logic behind the continuous rise in stock prices, are supported by its strong fundamentals.
From a financial performance perspective, its revenue, cash flow, revenue composition and other indicators are quite impressive. According to the prospectus, in 2023, Jike's total revenue was approximately 51.7 billion yuan, a year-on-year increase of 62%, and its net cash flow from operating activities was 2.28 billion yuan. The diversified revenue structure composed of vehicle sales, three electric business, research and development, and other services reflects the company's balanced and comprehensive development trend in various business areas.
Behind the eye-catching fundamentals, the high growth potential of Extreme Krypton is highlighted. As a luxury intelligent pure electric brand that has only been established for 3 years, Jike's rapid progress in revenue generation, market performance, and gross profit margin has made it a sought after asset for capital.
Taking revenue as an example, the total operating revenue of Jike in 2021, 2022, and 2023 was 6.5 billion yuan, 31.9 billion yuan, and 51.7 billion yuan, respectively, with a year-on-year increase of 62% in revenue in 2023. In terms of vehicle sales, the sales revenue of Geely Krypton vehicles in 2021, 2022, and 2023 were 1.54 billion yuan, 19.67 billion yuan, and 33.9 billion yuan respectively, with a year-on-year growth of approximately 72.4% in 2023.
Reflected in market performance, Jike stands out from a group of strong competitors in the face of multiple challenges such as expensive batteries, chip shortages, and price wars in the industry, and has won the position of the first brand in China's high-end pure electric market. As of the end of April 2024, Jike has delivered a total of over 240000 units, with over 16000 units delivered in April, a year-on-year increase of 99% and a new historical high. From January to April this year, Jike achieved more than doubling growth, a year-on-year increase of 111%, and continued to maintain its position as the sales champion of Chinese pure electric brands with a sales volume of over 200000 yuan.
Against the backdrop of most new car manufacturers not yet turning losses around, the level of gross profit margin has become an important indicator for external considerations of whether a company has sustained profitability.
On this indicator, the speed of Geely Krypton's turnaround is stronger than that of many competitors: its gross profit margin was positive during its initial period in 2021, and in 2023, Geely Krypton's gross profit margin reached 15%, an increase of 10.3 percentage points year-on-year from 4.7% in 2022. From 2023, compared to the industry, the gross profit margin of Geely is second only to Tesla among high-end pure electric vehicle companies.
In addition, as a luxury intelligent pure electric brand under Geely Holding Group, Jike not only had to compete with predecessors such as Weixiaoli who had a first mover advantage, but also faced competition from a group of "second generation" incubated by traditional car companies during the same period.
According to sorting, in July 2020, Dongfeng released a new high-end electric brand with the Chinese name "Lantu" and brand logo, and Lantu Automotive Technology Company was officially established; Avita Technology, a subsidiary of Chang'an, was established earlier in 2018
However, based on the latest market performance in April, the delivery volume of Extreme Krypton has achieved a leading position. Behind the delivery volume of over 16000 units of Extreme Krypton, Avita and Lantu delivered 5247 and 4003 units respectively in April.
Ping An Securities previously reported that the uniqueness of Geekrypton is that it is more thorough than traditional car companies in transformation. Geekrypton operates in the way of Internet technology companies, without historical baggage, and has a new brand, new products, new organizational structure, and new business model; Compared to new entrants, Jike has absolute advantages in quality assurance, supply chain system management, and other aspects.
Still in a period of undervaluation, the growth potential of Extreme Krypton has room for imagination
As the king of the high-end pure electric market, Jike is still actively competing. Under strong fundamentals and high growth potential, Jike, which has successfully gone public in the United States, has ushered in a new milestone in corporate development and opened a new chapter in the journey of globalization.
In the industry's view, considering the capital environment of its listing, Jike is still in a period of undervaluation. In fact, since the beginning of this year, new energy vehicle stocks in the United States have been in a state of continuous decline, including Tesla, whose stock prices have fallen by more than 20% since the beginning of the year.
Extreme Krypton also saw this. However, in its view, there are certain restrictions on regulatory approval and issuance deadlines for US stock IPOs, and the critical IPO milestones need to take into account objective factors of approval. Despite the current sluggish global investor sentiment and significant uncertainty in the capital market, they remain steadfast in their commitment to "long-term" and "value oriented" principles, not valuing short-term fluctuations, but placing greater emphasis on future long-term development and value.
"We will persist in exploring the path of long-term sustainable development through forward-looking strategic layout, stable business strategy, and continuous evolution of internal governance, and give back to society and investors with better business results." Jike said.
Standing at a new starting point, the growth potential of Extreme Krypton has room for imagination. It is reported that the funds raised from this listing of Extreme Krypton will mainly be used for research and development, products, and channels. We will adhere to direct sales and establish a self built energy supplement system. About 45% of it will be used for research and development of more advanced pure electric vehicle technology and expanding product portfolio, about 45% will be used for sales, marketing, and expanding services and charging networks, and about 10% will be used for general corporate purposes, including working capital needs, to support business operations.
Faced with increasingly fierce market competition, Jike chooses to walk on multiple legs and adheres to the development strategy of "one vertical and one horizontal globalization". On the one hand, it persistently expands its technological moat through research and development to ensure its core competitiveness; On the other hand, setting sail to the sea is a sword against globalization.
In terms of vertically strengthening the vertical integration of the industrial chain, Jike has continuously made breakthroughs and innovations in various core technology fields of new energy vehicles, and has invested nearly 17 billion yuan in research and development expenses in the past three years. Its self-developed electric drive, 800V gold brick battery, fully stack self-developed advanced intelligent driving assistance system - Haohan Intelligent Driving, and L4 level integrated die-casting intelligent production line technology brands have become the confidence to sit on the competition table of intelligent electric vehicle brands.
The extreme Krypton architecture car manufacturing concept will win more market votes and strive for a larger market share. It is reported that the mass-produced pure electric models of Jike are all based on the SEA vast architecture, which greatly improves research and development efficiency, economies of scale, and leads category innovation, efficiently ensuring the launch of five new models in three years and the annual launch speed of no less than two new models by 2025.
Horizontally, Extreme Krypton strengthens ecological collaboration and has laid out the "Three 800" ultra fast charging full ecological solution, which includes 800V vehicles, 800V electricity (power batteries), and 800V grid (supplementary energy network). At present, Geely Krypton has become the car company with the highest production of 800 volt models worldwide, including the all-new Geely Krypton 001, Geely Krypton 001 FR, Geely Krypton 009 Glory, Geely Krypton 007, Geely Krypton MIX and other models. As of the end of April, the number of ultra fast charging piles has exceeded 2500.
In terms of promoting globalization, in 2024, Geely Krypton will not only enter the luxury markets of 8 European countries, but also enter markets in 50 countries and regions such as Southeast Asia, the Middle East, South America, and Australia, accelerating its globalization strategy comprehensively. As of the end of April, Jike has built nearly 380 stores worldwide.
"On the track of long-distance runners, controlling speed is crucial. We won't always move forward at a sprint speed, but we must always maintain a state of giving it our all. There is no finish line for an upward marathon," An Conghui once said. After going public in the United States, Extreme Krypton, which is still running hard, is heading towards a brighter future.