(Nov 6): Pony AI Inc and WeRide Inc fell on their trading debuts in Hong Kong after the pair of Chinese robotaxi firms battled for investors during their public offerings, which raised more than US$1.1 billion.
Pony AI declined as much as 15% to HK$118.80, while WeRide dropped as much as 15% to HK$23 on Thursday. Both companies’ American depositary receipts had declined since they priced their Hong Kong shares.
After rallying more than most other major stock indices this year, concerns about lofty valuations have soured the mood in Hong Kong in recent weeks, with the Hang Seng becoming one of the worst-performing benchmarks in the past month. That’s taken the shine off what had otherwise been a stellar year for the city, which is headed for its best year for new listings since 2021.
“These offerings have a timing issue,” said Sandeep Rao, an analyst at Leverage Shares plc. “They are either six months too late or a year too early for drawing investor attention.”
During their offerings, Pony AI raised HK$6.7 billion, while WeRide’s deal fetched HK$2.4 billion, giving both unprofitable firms funds to keep working on their self-driving technology.
In terms of the industry, Pony AI, WeRide and Baidu Inc’s Apollo Go are outnumbering American counterparts with more robotaxi projects progressing from testing to various stages of commercialization, according to BloombergNEF. While much of that headway is being made domestically, the Chinese companies are standing up operations in places like Dubai, Abu Dhabi and Singapore, and looking to launch in Germany, the UK and elsewhere in Europe.
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The potential for the technology to pay off makes the shares a good long-term bet, according to Evelyn Zhang, an analyst at Daiwa Capital Markets Hong Kong Ltd.
“Pony AI and WeRide have presented the market good plans to monetise the technology,” she said. “Pony AI and WeRide are now scarce investable assets in autonomous driving globally.”
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Still, the offerings were unusual in that the head-to-head competitors listed on the same day, and the rivalry got intense during the deal offerings, with WeRide saying that Pony AI misinformed investors with inaccurate information — a point that WeRide chief executive officer Tony Han made again in a Bloomberg TV interview.
“WeRide, with our numbers, we see our perspectives and real numbers and we are confident,” Han said. “I am happy with the progress.”
In a separate Bloomberg TV interview, Pony AI chief executive officer James Peng said that it was a good thing for the deals to coincide with each other.
“I am actually super happy” both companies listed on the same day, Peng said. “It’s actually a great thing that shows the market is recognising that this is a business that’s going to actually have super growth down the road.”
Uploaded by Tham Yek Lee
