Source | Yuan Auto

Incomplete statistics reveal that in the first half of this year, five listed automobile companies on the Hong Kong Stock Exchange witnessed declines ranging from 15% to 40%, while another five experienced drops exceeding 45%. Among these ten entities are leading new-force automakers that have consistently achieved record-high sales volumes. In contrast, Geely Automobile, NIO, and BYD Company Limited, which suffered declines of less than 10%, can be seen as outperforming the broader automobile sector on the Hong Kong Stock Exchange.

Against this backdrop, on the final day of the first half of 2026, Avita updated and submitted its application materials for listing on the Main Board of the Hong Kong Stock Exchange.

As a new energy vehicle company under Changan Automobile, targeting the high-end market, Avita's plan to list on the Hong Kong Stock Exchange is hardly a secret. Approximately seven months ago (November 27, 2025), it submitted its prospectus to the Hong Kong Stock Exchange but has yet to complete the listing hearing and the listing process. According to regulations, if the listing hearing and the listing process are not finalized within six months from the date of prospectus submission, the application documents automatically become invalid.

From this perspective, Avita's decision to go public amid the current underperformance of the overall automobile sector on the Hong Kong Stock Exchange can be seen as a last-minute move. After all, the last thing Avita and Changan Automobile want is to be tainted by the term "listing delay."

More importantly, the inclusion of additional full-year 2025 financial data in the updated prospectus has become a strategic asset for Avita to go public despite unfavorable conditions.

01 A Year of Breakthrough

According to the prospectus data, Avita in 2025 presents potential to investors.

With the introduction of the new, more affordably priced model, Avita 06, and the addition of extended-range versions to several existing models, Avita reached a sales peak in 2025. As revenue and gross profit increased, the gross profit margin, a key indicator of an automaker's profitability, rose to 9.4%, up nearly 50% year-on-year.

This directly helped Avita narrow its losses by about 13.2% year-on-year to RMB 3.49 billion (same below). For comparison, in 2025, several listed automakers with better market performance than Avita actually saw their losses widen, such as Dongfeng Voyah, which is similar in scale and background to Avita, and Seres, which leads in sales in the high-end segment.

Of course, some competitors' increased losses in 2025 may also be attributed to heightened investments. Nevertheless, Avita's ability to narrow its losses is a very positive signal, which is underpinned by its increasingly diversified profit-making methods.

Firstly, with the growing number of brand models on the market and Avita's relatively high-end positioning, income from "other businesses," including ecosystem and after-sales services, has begun to take shape. The prospectus reveals that in 2025, Avita's income from parts and other businesses surged by over 120% year-on-year to RMB 1.729 billion, compared to just RMB 103 million in 2024.

Secondly, after targeted optimization of its models and enhancement of its sales channels, overseas business has also emerged as a new growth avenue for Avita. Data indicates that Avita's overseas income in 2025 soared by over 535% year-on-year to RMB 1.398 billion, with an average overseas selling price of new vehicles exceeding RMB 300,000. Overseas markets centered on Southeast Asia, the Middle East and Africa, Eurasia, and Central and South America are contributing profits that may be even more substantial than those from the domestic market.

Roughly calculated, the above two businesses, which boast higher gross profit margins than simply manufacturing and selling vehicles domestically, already account for more than 12% of Avita's overall revenue. This will be Avita's capital to "compete fiercely" with domestic competitors.

It is worth noting that after Avita's strategic investment of RMB 11.5 billion in Yinwang, a company led by Huawei's Automotive BU, in 2025, it has already yielded returns in the first year of investment. The prospectus shows that Avita's share of Yinwang's profits in 2025 was RMB 182 million. According to media reports, Yinwang's revenue in 2025 exceeded RMB 45 billion, up 72.1% year-on-year.

It must be said that Avita's revenue streams are quite promising.

02 Seizing the Opportunity of a Temporal Gap?

Looking back at Avita's decision to update its prospectus on the last day of the first half of 2026, besides the notion that "there's no turning back once the bowstring is drawn," there may be another interpretation—the ability to temporarily delay disclosing data for the first half of 2026.

According to third-party terminal retail data from the China Passenger Car Association (CPCA) and the China Association of Automobile Manufacturers (CAAM), Avita's cumulative sales from January to May this year were 22,906 units, compared to 41,709 units during the same period in 2025. Regarding the official sales volume for the first half of 2026, Avita's WeChat official account did not disclose it in its July 1 post, following the industry trend, only announcing a delivery volume of 7,459 units in June.

However, Avita's sales fluctuations are understandable, as it is still in a period of deep adjustment following its major shareholder, Changan Automobile, being upgraded to a first-tier central enterprise.

Although Avita's positioning within the China Changan Automobile Group and the appointment of its management were officially announced in July 2025, relevant adjustments have persisted until this year. Taking the management team as an example, in the first half of this year, Avita Technology had to adapt to the full assumption of duties by Chairman Wang Hui and the resignation of former Avita Technology CEO Tan Benhong. Additionally, Vice President Sun Baigong joined to oversee marketing and brand communication. This new automaker, born out of a traditional central enterprise, is facing unprecedented personnel complexity.

At the same time, to align with the industry's main theme of cost reduction and efficiency improvement, Zhu Huarong, Chairman of the China Changan Automobile Group, stated during the global strategy conference on April 21 this year that Avita and Shenlan Automobile would undergo strategic integration, focusing on "independent front-end operations and collaborative middle and back-end operations."

The so-called "independent front-end operations" means that Avita and Shenlan will maintain independent operations in terms of sales channels, product positioning, and user operations, while the "middle and back-end operations," including vehicle research and development, intelligent driving technology routes, supply chain procurement, and overseas production layout, will be fully connected and shared.

"The integration is expected to be completed by the end of 2026, with an estimated cost reduction of 20% to 30% for the public resources of both brands," Zhu Huarong said in a media communication session after the conference.

Given such significant adjustments, Avita's market performance in the first half of this year is understandable. If Avita's current listing application is successfully approved on the Hong Kong Stock Exchange, it will perfectly downplay the "adjustment period" in the first half of 2026 and align with the more vibrant second half of the year.

According to the plan, Avita will launch new models jointly created with Huawei Yinwang in the second half of this year. The first model, Avita 07L, will debut in the third quarter, and a flagship six-seater SUV may also be launched within the year. It is reported that the Avita 07L is positioned in the booming segment of large five-seater luxury SUVs, while the flagship six-seater SUV is expected to become Avita's trump card in joining the "9 Series" SUV competition.

Daring to apply for listing when the automobile sector on the Hong Kong Stock Exchange is underperforming, Avita's bargaining chips should not be underestimated.

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