China Hesai Group shares rise in New York debut

Hesai

09/02/2023 21:45

By Scott Murdoch and Echo Wang
       NEW YORK, Feb 9 (Reuters) - Chinese sensor maker Hesai
Group's  HSAI.O  shares closed 10.8% percent higher at $21.05 on
their first day of trade in New York after the company raised
$190 million in its upsized initial public offering (IPO), the
largest deal by a mainland Chinese company in the United States
in more than a year. 
    The company sold 10 million American depository shares (ADS)
at $19 apiece, according to its regulatory filings.
    The Shanghai-based Hesai produces laser-based components
essential for autonomous driving systems known as lidar sensors.
    The deal is the largest from a Chinese company to sell
shares in New York since LianBio  LIAN.O  raised $334 million in
October 2021, according to Refinitiv data.
    "We always wanted to be able to compete at the global stage,
not only on the product, but also on the capital side,” Hesai's
co-founder and CEO, Yifan "David" Li, told Reuters.
    Chinese company listings in the United States hit a halt in
2021 following the debut of ride hailing giant Didi Global Inc 
 92Sy.MU  in June of that year.
    Days after Didi went public, China's powerful internet
watchdog, Cyberspace Administration of China (CAC), launched a
cybersecurity probe into the company's data practices and
ordered app stores to remove 25 mobile apps operated by Didi. 
    As a result, Chinese listings in the United States dwindled
and mainland regulators also moved to draw up new guidelines
governing companies selling shares overseas.
    The final rules are yet to be published by the China
Securities Regulatory Commission (CSRC). 
    China also announced in January last year that platform
companies with data on more than 1 million users would require
sign-off from the CAC before listing overseas.
    “Unfortunately, there were a lot of regulatory concerns from
last year that it became challenging for anybody to list. And I
feel like most of those concerns are gone", said Li, adding,
"investors are pretty confident and somewhat bullish about our
business."   
    Chinese companies raised nearly $230 million in U.S.
listings in 2022, according to Refinitiv data, representing a
massive drop from $12.85 billion a year earlier.
    However, advisers are hoping China's reopened borders and
the government's renewed focus on reviving economic growth could
prompt more capital raises and share sales. 
    After the U.S. accounting watchdog said in mid-December that
it had full access to inspect and investigate firms in China for
the first time ever, the prospect of Chinese companies in the
United States being delisted over accounting issues has been
reduced.
 (Reporting by Scott Murdoch in Sydney and Echo Wang in New
York)
 ((Scott.Murdoch@thomsonreuters.com;))