Adopting an introductory approach: Lantu Automobile's Hong Kong Stock Exchange listing debut meets with cold reception

Viewpoint Network Hong Kong Report: Lantu Auto’s Listing Day Meets Cold Reception

On March 19, Dongfeng Motor Corporation’s high-end electric vehicle company, Lantu Auto, successfully listed on the Hong Kong Stock Exchange through an introduction, becoming China’s first state-owned enterprise premium electric vehicle brand to go public in Hong Kong.

That morning, at the Hong Kong Financial Hall of the Hong Kong Stock Exchange, there was a large crowd. Hong Kong Stock Exchange Group CEO Charles Li and Liu Wei, Chief Accountant and Party Committee Member of Dongfeng Motor Corporation, attended the listing ceremony.

It is understood that Lantu’s listing in Hong Kong was conducted via an introduction, with no new shares issued and no fundraising.

Lantu’s listing marks the conclusion of a months-long restructuring by Dongfeng, a state-owned automaker. Dongfeng Group announced that starting from 4 p.m. on March 18, it would revoke the listing status of H-shares on the Hong Kong Stock Exchange, officially ending its 20-year listing in Hong Kong. According to the transaction arrangement, shareholders holding 1 share of Dongfeng Group H-shares will receive HKD 6.68 in cash and 0.3552608 Lantu H-shares.

The transaction involves a “equity distribution + absorption merger” model, a corporate restructuring approach where Dongfeng Group distributes its equity in Lantu Auto to all shareholders proportionally, and then its domestic subsidiary, Dongfeng Motor, as the absorbing entity, acquires all circulating H-shares of Dongfeng Group.

Dongfeng Group’s delisting from Hong Kong and the spin-off of Lantu aim to unlock the value of its fastest-growing electric vehicle business.

However, on its first day of listing, Lantu Auto experienced a decline in funds. The opening price was HKD 7.5, but it fluctuated downward, closing at HKD 6.51, a 13.2% drop from the opening price. The total trading volume for the day was HKD 651 million, with a total market capitalization of HKD 23.957 billion at close.

Sources indicate that before delisting, Dongfeng Group’s last reported price was HKD 9.54. Since announcing the restructuring last August, its stock has risen by 60%. Based on the last trading price and transaction structure, Lantu’s implied share price is approximately HKD 8.05. There are 885,381,529 H-shares listed in Hong Kong.

Jiang Tao, Director and General Manager of Lantu Auto, stated at the listing ceremony that Lantu is a high-end intelligent new energy brand developed by Dongfeng Motor, committed to becoming a user-oriented technology company that drives dreams and empowers a better life. “We see this listing as a new starting point, and will provide excellent products and services to our users, contributing to the prosperity and development of Hong Kong’s capital markets.”

Data shows that by 2025, Lantu Auto is expected to achieve revenue of 34.9 billion yuan, with a compound annual growth rate of 79% over the past four years; gross profit margin of 20.9%; and net profit attributable to parent of 1.02 billion yuan, turning profitable. The company also expects to receive approximately 1.08 billion yuan in government subsidies in 2025.

Lantu Auto’s sales are projected to surpass 150,000 units in 2025. In terms of sales structure, the Dreamer series accounts for over 50% of total sales, becoming the main model. By 2026, data from the passenger vehicle market shows that in January, Lantu Dreamer sales were 3,574 units, a year-on-year decrease. Regarding R&D investment, the prospectus indicates that from 2022 to 2025, R&D expenses as a percentage of operating income were 5.5%, 4.7%, 4.2%, and 3.9%, respectively, showing a decreasing trend.

In terms of overseas expansion, Lantu Auto has sold vehicles to over 40 countries and regions, including Norway, Denmark, and the Netherlands. In the first two months of 2026, Dongfeng New Energy Vehicles exported 26,000 units, a year-on-year increase of 106.8%.

Disclaimer: The content and data in this article are compiled by Viewpoint based on publicly available information and do not constitute investment advice. Please verify before use.