BRIEF: Zenergy to raise $65 million through 8% discounted share placement

Lithium battery maker Jiangsu Zenergy Battery Technology Group Co. Ltd. (3677.HK) on Friday announced that it plans to place 45.9 million new H-shares, representing 3.09% of the enlarged capital for its Hong Kong-listed shares and 1.8% of its total issued shares.

The placement will raise HK$504 million ($64.86 million), with the offer price set at HK$10.98 per share, representing a 7.89% discount to the previous day’s closing price of HK$11.92.

The company said it will use 70% of the net proceeds to fund construction, equipment procurement, and contingency expenses for the second phase of its new manufacturing plant in the city of Changshu; around 10% will go toward building a pilot line for all-solid-state batteries; another 10% will be allocated to R&D; and the remaining 10% will be used for working capital and general corporate purposes.

The company reported revenue of 3.17 billion yuan ($445 million) in the first half of this year, up 71.9% year-on-year. Revenue from power batteries surged 81.9% to 3 billion yuan. The company’s gross margin jumped from 9.9% in the first half of last year to 17.9% in the latest reporting period, and it swung to a net profit of 222 million yuan.

Zenergy’s stock opened lower on Friday and closed at HK$11.01 by the midday break, down 7.63%. The stock has risen about 30% since its listing in April.

By Lee Shih Ta

To subscribe to Bamboo Works weekly free newsletter, click here