Zenergy Makes Strong Hong Kong Debut: Battery Innovator Turns Profitable After Strategic Pivot

Zenergy (正力新能，03677.HK) successfully debuted on the Main Board of the Hong Kong Stock Exchange today, with China International Capital Corporation and CMB International serving as joint sponsors. As a power and energy storage battery manufacturer, Zenergy provides integrated solutions for battery cells, modules, packs, clusters, and battery management systems.

source: Zenergy

The company offers power batteries for multiple vehicle types, including HEV (Hybrid Electric Vehicles), PHEV (Plug-in Hybrid Electric Vehicles), EREV (Extended-Range Electric Vehicles), and BEV (Battery Electric Vehicles), as well as energy storage batteries for various applications including large-scale storage, commercial and industrial storage, and residential storage systems.

Additionally, Zenergy's product portfolio includes marine and aviation batteries capable of powering various vessels and low-altitude aircraft, though these have not yet achieved large-scale commercial application.

According to the prospectus, in 2023, the company's power battery installation volume reached 5.4GWh, ranking tenth among Chinese power battery manufacturers.

For fiscal years 2021, 2022, 2023, and 2024, Zenergy reported revenues of approximately RMB 1.499 billion, RMB 3.290 billion, RMB 4.162 billion, and RMB 5.130 billion respectively. Notably, the company posted losses of approximately RMB 402 million, RMB 1.720 billion, and RMB 590 million for fiscal years 2021, 2022, and 2023. The substantial increase in losses in 2022 was primarily due to a major customer canceling orders, resulting in decreased sales volume and revenue from ternary batteries, leading to inventory impairment losses of RMB 422 million and trade receivables impairment losses of RMB 601 million. However, in fiscal year 2024, Zenergy successfully turned profitable, achieving a profit of RMB 91.014 million.

Proceeds from Zenergy's Hong Kong IPO will be used for capacity expansion, construction of intelligent manufacturing facilities and flexible production lines, various R&D activities, and working capital and other general corporate purposes.