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Hindustan Times
11 hours ago
- Automotive
- Hindustan Times
Xiaomi SUV Takes Aim at Tesla
Preorders for the YU7 hit 289,000 in the first hour of sales, according to Xiaomi. Xiaomi has launched a new car that analysts say might be a serious challenger to Tesla's bestselling Model Y. PREMIUM Xiaomi SUV Takes Aim at Tesla The Chinese company, a consumer electronics giant that has expanded into electric vehicles, unveiled the YU7 sport-utility vehicle at an event Thursday. As he presented the car, Xiaomi founder Lei Jun compared it to Tesla's Model Y, pointing out that the YU7 is about $1,395 cheaper. The starting price for the YU7 is 253,500 yuan, equivalent to $35,367. Prices for Tesla's Model Y start at 263,500 yuan in China. The more premium YU7 Pro and YU7 Max models have price tags of 279,900 yuan and 329,900 yuan, respectively. Analysts had been keenly watching the launch, which comes as carmakers lock into another price war as they seek to win over cautious Chinese consumers. Shares of Xiaomi jumped Friday morning in Hong Kong, rising as much as 8.0% and hitting a new high before paring gains. The stock was last up 3.5% at HK$58.95, and up 71% for the year. Preorders for the YU7 reached 200,000 within the first three minutes of sales, and hit 289,000 in the first hour, according to Xiaomi. That already exceeds most buy-side expectations for the first 24 hours, Citi analysts led by Kyna Wong wrote in a note. They see upside to their forecast of 400,000 units in Xiaomi EV shipments this year. Xiaomi's rollout could stir up more pricing battles in China's fiercely competitive EV space. Last month, BYD—the country's biggest EV maker—slashed prices on several models, prompting similar moves by rivals. 'As the major competitor, we expect Tesla may cut prices further,' Citi analysts led by Jeff Chung said in a note. Another big EV maker, XPeng, could also cut prices on its G7 SUV to stay competitive, the Citi analysts added. Pricing for Li Auto's all-electric i8 SUV is unlikely to be directly affected, but the analysts think there might be an impact on the i6. Shares of XPeng were last down 2.7% in Hong Kong, while Li Auto was 0.8% lower. Shares in Contemporary Amperex Technology Co.–a battery maker that supplies batteries for Xiaomi's cars—were up 0.7%. Focus now turns to Xiaomi's upcoming earnings and guidance, due in August, which will show how its EV business is stacking up against its smartphone segment, the company's biggest revenue driver. Attention will also be on Xiaomi's Internet of Things and lifestyle products segment, after revenue hit a record in the first quarter, thanks in part to sales of wearables. The Beijing-based company introduced a new line of wearables and IOT products at Thursday's SUV launch, including AI glasses and smartphones. Write to Tracy Qu at
Japan Times
25-03-2025
- Automotive
- Japan Times
Xiaomi raises $5.5 billion in upsized Hong Kong share sale
Xiaomi raised about $5.5 billion in an upsized share sale, as the Chinese tech firm capitalizes on a surge in its stock price to help raise funds to expand its electric-vehicle business. The offering, which comes weeks after EV giant BYD's $5.6 billion fundraising, builds on what's shaping up to be a bumper year for share sales in Hong Kong. After several years of declines, the city's benchmark stock index is among the world's best performers this year, fueling optimism for a rebound in deals in the Asian financial hub. Beijing-based Xiaomi placed 800 million shares at HK$53.25 each ($6.85), or 6.6% below Monday's close. The stock fell as much as 6.6% on Tuesday. The company had earlier been looking to sell 750 million shares at HK$52.80 to HK$54.60 apiece, according to terms of the deal. Xiaomi has been investing aggressively in its nascent EV business to drive growth. It recently increased its 2025 EV delivery target after posting the fastest revenue growth since 2021. As part of its efforts to ramp up production, the company is expanding the size of a planned second factory in the Chinese capital. Prior to today, the Hang Seng Index had gained 19% this year, helping renew interest in Hong Kong stocks among global investors who had shied away from Chinese deals in the past few years, with expectations running high for more companies to tap the equity markets this year. Xiaomi's stock has more than tripled from a low in August, making it the best performer on the Hang Seng. The company has won investors over by duplicating its smartphone success in China's crowded EV market. The fundraising can be a long-term positive for the company given the potential for deleveraging, artificial intelligence-related research and development and building out its EV capacity, Citigroup analyst Kyna Wong wrote in a report. In the short term, though, it will pressure the shares given the dilution, the analyst noted. The offering was multiple times subscribed and it received strong interest from long-only investors and sovereign wealth funds, people familiar with the matter said, asking not to be named as they weren't authorized to speak publicly. Xiaomi's placement puts Hong Kong on course to have its biggest quarter for share sales since the last three months of 2021, when almost $16 billion was raised. Prior to Xiaomi, equity deals in Hong Kong including initial public offerings had hit nearly $10 billion this year, more than sevenfold from a year earlier, according to the data. Xiaomi plans to use the proceeds from its placement to accelerate its business expansion and invest in research and development to advance technological capabilities, the terms show. China International Capital Corporation, Goldman Sachs and JPMorgan Chase worked on the share sale, according to the terms.
