Shares of Chinese smart electric vehicle (Smart EV) manufacturer XPeng, Inc. (XPEV) gained 9.6% to close at $40.73, following the news of its inclusion in the Shenzhen-Hong Kong Stock Connect Program.
The Shenzhen Stock Exchange announced that effective February 9, XPeng’s ordinary shares listed on the Stock Exchange of Hong Kong Limited (HKEX) will become a part of the Stock Connect Programs.
XPeng is one of the best and fastest-growing EV stocks both in the U.S. and China markets. Its shares have lost 8.2% in its NYSE listing over the past year. Meanwhile, at the Hong Kong Exchange (HKG: 9868), its shares have lost 5.7% over the past year.
Shenzhen-Hong Kong Stock Connect Programs
The Stock Connect Programs is a collaboration between the Hong Kong, Shanghai, and Shenzhen stock exchanges which enable both international and mainland Chinese investors to trade in each other’s markets.
The program increases the investor base of the companies included in the program. Inter-exchange trading is subject to certain daily quotas and can be done through the clearing and trading facilities of participating exchanges.
XPeng is one of the first Smart EV companies on the HKEX to be included in the program. It was also one of its kind to achieve dual-primary listing status on both the NYSE and HKEX.
On July 8, 2021, Hang Seng Indexes Company Limited had announced that since XPeng met the Fast Entry Rule for various indexes, it would be eligible to be included in several indexes effective July 21, 2021. Following this, XPeng also met the main criteria for the Stock Connect Program of being included in the Hang Seng Composite Index.
Delighted with the news, Brian Gu, Vice Chairman and President of XPeng, said, “We are pleased to be included in the Stock Connect programs, which enable qualified Mainland Chinese investors to have direct access to our shares through the Stock Exchanges in the Mainland.”
“The inclusion will not only further expand and diversify our investor base but also provide the opportunity for our customers, partners, and EV and technology investors in China to participate in our exciting growth story,” Gu concluded.
Recently, Barclays analyst Jiong Shao initiated coverage of the XPEV stock with a Buy rating and price target of $45, which implies 10.5% upside potential to current levels.
With 4 unanimous Buys, the stock commands a Strong Buy consensus rating. The average XPeng price target of $59.09 implies 45.1% upside potential to current levels.
TipRanks data shows that financial blogger opinions are 100% Bullish on XPEV, compared to a sector average of 72%.
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