(Yicai) Nov. 28 -- Avatr Technology, a luxury electric vehicle maker backed by China’s Changan Automobile, has applied for an initial public offering in Hong Kong.

The proceeds of the IPO will be used to develop new models, build a next-generation smart platform architecture, enhance branding and sales networks, and supplement working capital, according to Avatr’s filing to Hong Kong Stock Exchange yesterday.

Avatr did not disclose the amount the Chongqing-based company aims to raise. The IPO’s underwriters are Citic Securities and China International Capital Corporation.

The seven-year-old carmaker began mass production and deliveries in December 2022. It delivered 20,021 vehicles in 2023, 61,588 last year, and 56,729 in the first half of this year.

Thanks to rapid sales growth, the firm’s revenue doubled to CNY12.2 billion (USD1.7 billion) in the six months ended June 30 from a year ago, while its net loss widened 11 percent to CNY1.6 billion (USD226.1 million). Between 2022 and 2024, Avatr lost CNY9.7 billion. Revenue was CNY15.2 billion last year, a 169 percent increase from 2023.

Avatr’s continued cash burn has been sustained by substantial shareholder backing. Since its establishment, the company has raised more than CNY19 billion across four funding rounds, including a CNY11 billion Series C round last December led by Changan Auto.

As of June 30, Changan Auto was Avatr's largest shareholder with a 41 percent stake. Battery giant Contemporary Amperex Technology was the second-largest with 9.2 percent.

Avatr is working with Chinese tech heavyweight Huawei Technologies and battery giant Contemporary Amperex Technology to jointly develop premium smart EVs. 

Though Huawei is not a shareholder, the two companies maintain equity-level collaboration. In August last year, Avatr announced it would spend CNY11.5 billion to acquire a 10 percent stake in Yinwang Intelligent Technology, a Huawei unit specializing in smart driving systems.

Editor: Futura Costaglione