XPeng (XPEV) Eyes Further Expansion, Secures $2B Credit Facility
XPeng Inc. XPEV recently inked a strategic agreement with five Chinese banks to secure a credit line of 12.8 billion yuan ($2 billion) for expansion of its manufacturing, sales and service capabilities.
The agreement has been signed with five domestic banks — Agricultural Bank of China, Bank of China, China Construction Bank, China CITIC Bank and Guangzhou Rural Commercial Bank. The credit facilities provided by these banks will aid XPeng in enhancing the efficiency of its cash management, cost control and other corporate functions.
XPeng — The Rising Star of China’s EV Market
XPeng, backed by Alibaba Group and Hillhouse Capital Management, is a leading Chinese smart electric vehicle (EV) company that designs, develops, manufactures, and markets Smart EVs catering the large and growing base of technology-savvy middle-income consumers in China.
Though XPeng is nowhere near the U.S.-based EV behemoth Tesla TSLA, but like its other Chinese peers, Nio Inc. NIO and Li Auto LI, it has managed to garner a lot of investors attention.
The company raised $900 million before its initial public offering and $1.7 billion during its share sale last August. In fact, last December, XPeng successfully completed its first public follow-on offering, raising $2.5 billion by selling American depositary shares at $45 apiece.
The company started its second manufacturing base in Guangzhou last November, making it the first Chinese start-up EV maker with two self-owned factories. Moreover, the EV maker has widened its physical sales network to 58 cities and 50 service centers in China.
The company has also expanded its XPeng-branded supercharging stations to 135 and provides free charging services at 670 stations across 100 Chinese cities. The automaker recorded delivery of 27,041 cars last year.
The maker of the P7 sedan and the G3 SUV will officially launch its third model, an all-electric SUV, this year. The model will be integrated with lidar technology, marking a breakthrough achievement owing to mass production deployment of the state-of-the-art autonomous driving technology.
Last December, the company delivered the first batch of 100 electric SUVs to customers in Norway, achieving another milestone for its global business.
The latest strategic cooperation with the leading financial institutions will further diversify the company’s funding channels, highlighting its robust fundamentals and stellar growth prospects. This will enable XPeng to fuel its long-term growth by strengthening the core business areas. It will accelerate the company’s unfaltering commitment to technology innovation and customer services, by putting forth a fascinating EV experience specific to consumers’ requirements.
XPeng currently carries a Zacks Rank of 3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Notably, shares of the company have rallied 109% in the past year compared with its industry’s rise of 23.7%.
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