Chinese autonomous driving technology company Horizon Robotics plans to list on the Hong Kong Stock Exchange on October 24th. On October 23rd, the stock closed up 36% in Hong Kong dark market trading.
Horizon Robotics plans to publicly raise HKD 5.4 billion (approximately USD 700 million) in the Hong Kong stock market, which will be the largest IPO in Hong Kong this year and one of the largest technology industry IPOs in recent years.
According to regulatory documents submitted by Horizon Robotics, its cornerstone investors, including Alibaba and Baidu, have subscribed for stocks worth approximately $220 million. Regulatory documents also show that the company sold 1.355 billion shares at a price range of HKD 3.73 to HKD 3.99 per share.
The enthusiasm of investors for subscribing to Horizon Robotics also reflects that the Hong Kong IPO market may show signs of activity after nearly two years of downturn. In the past month and a half, the Hang Seng Index has risen by about 20%.
Horizon Robotics was founded in 2015 by artificial intelligence scientist Yu Kai and others. Yu Kai previously worked at Baidu and played an important role in helping Baidu enter the field of autonomous driving. As of now, Horizon has not yet achieved profitability. From 2021 to the first half of 2024, Horizon suffered a total loss of over 20 billion yuan, mainly due to its high research and development capabilities.
A former business leader of a multinational car company who had close cooperation with Horizon Robotics told First Financial reporters, "It is difficult for these types of autonomous driving companies to make profits, and successfully going public is already the best outcome
In the past two years, the development of Horizon Robotics has also encountered setbacks, such as the star product "Journey 5" not even being highlighted in the prospectus. The prospectus of Horizon Robotics stated that the company's chips have been installed in 290 products, but the products installed in the car are mainly the first two generations of Journey 2 and Journey 3. The cooperation progress between Journey 5 and first tier suppliers is slow.
A relevant person from an autonomous driving technology company that did not use Horizon Robotics chips told First Financial reporters, "We have also evaluated the computing power of Journey 5, and found that the actual test results are quite different from what we imagined
In addition, Horizon is clearly dependent on major clients. The top five customers of the company accounted for nearly 80% of the total revenue in the first half of this year. Among them, one of the largest customers is Core Cheng, a joint venture established by Horizon and CARIAD, a software company of Volkswagen Group, which is mainly engaged in the research, development and manufacturing of automatic driving application software and auto drive system.