CATL IPO: will the EV battery giant’s Hong Kong debut revive the city’s capital markets?

Contemporary Amperex Technology Co. Ltd. (CATL), the world’s largest electric vehicle battery manufacturer, has filed for a secondary listing in Hong Kong in what could be the city's largest stock offering in years.

The move by the Shenzhen-listed battery giant, a key supplier to Tesla, Volkswagen, and other major automakers, underscores Hong Kong’s growing role as a capital-raising hub for Chinese firms.

The long-anticipated listing is part of a broader wave of Chinese companies seeking offshore funding, with analysts forecasting a $20 billion rebound in Hong Kong's initial public offerings this year.

CATL has appointed JPMorgan, Bank of America, China’s CICC, and China Securities International as lead banks for the offering, with Goldman Sachs, Morgan Stanley, and UBS also involved in the deal.

The listing, however, comes at a delicate time for CATL.

The company was added to a US blacklist last month for alleged ties to China’s military, raising potential challenges for its overseas expansion.

In its prospectus, CATL dismissed the designation as a mistake and stated it was actively working to have it removed.

The restriction limits the company’s dealings with certain US government agencies but does not directly impact its global commercial operations.

CATL could raise up to $7 billion

While CATL has not disclosed the exact size or timeline of the offering, market sources suggest it could raise up to $7 billion, depending on market conditions.

Morgan Stanley had earlier estimated that the listing could bring in as much as $7.7 billion.

The company intends to use the funds to accelerate its global expansion, including a new production facility in Hungary and a joint venture with Stellantis in Spain.

CATL is also investing in battery projects in Indonesia as part of its broader strategy to solidify its position as the dominant player in the EV battery market.

Despite its market leadership, CATL has warned of a potential revenue decline of up to 11% in 2024 due to lower product prices.

The company, which has held the top spot in the global EV battery industry for eight consecutive years with a 38% market share in 2024, reported revenues exceeding $50 billion in 2023.

However, it expects net income growth of up to 20% for last year, its slowest pace since 2019.

Can CATL's listing boost Hong Kong’s capital market

CATL’s listing is expected to be a crucial test for Hong Kong’s stock market, which has struggled with weak deal flows in recent years.

The city’s capital markets have seen a resurgence in early 2025, driven in part by renewed investor confidence in Chinese technology and electronics stocks.

The Hang Seng Index has climbed 13% over the past month, bolstered by optimism following breakthroughs in artificial intelligence and a more favorable economic outlook.

“It is too early to say Hong Kong is back,” Gary Ng, a senior economist at Natixis, told the FT.

The CATL listing “signals that Hong Kong still has advantages for Chinese firms seeking overseas funding”, Ng said, but added that “equity investors remain sceptical of valuations due to decelerating growth in China and geopolitics”. 

Hong Kong’s investment banks may also see limited gains from the renewed IPO activity.

The Financial Times recently reported that rising competition from Chinese banks has pressured fees for deals like CATL’s, making it harder for global banks to profit from the listing boom.

CATL’s heavily redacted filing also flagged currency risks, noting that fluctuations in the renminbi could impact its ability to pay dividends in Hong Kong dollars.

Such concerns reflect broader uncertainties surrounding Chinese firms seeking offshore listings amid volatile economic conditions.

As CATL moves forward with its Hong Kong debut, investors will be watching closely to see whether the offering can reinvigorate the city’s IPO market and whether geopolitical risks will pose any further hurdles to its global ambitions.