In-depth analysis of WeRide Inc. IPO, discussing the company’s financial growth and investment possibilities

WeRide Inc, a China-based autonomous driving technology company focused on developing safe and reliable self-driving solutions, has published that its IPO is going to be floated on the 20^th of August 2024. It aims to gather US$109.68 million with 6,452,000 shares, with a price range of US$15.50 – US$18.50.

Table of Contents

• Company Overview
• Company Strategy
• IPO Profile
• IPO Objective
• Application Process of IPO
• Financial Analysis of Company
• Competitor Analysis
• Details on Company Management
• Manager/ Joint Manager of WeRide Inc
• Co-managers of WeRide Inc
• Company Address

Company Overview

WeRide Inc. is an autonomous driving technology company operating in China, offering driverless solutions for urban transportation. Incorporated in 2017, this company applies artificial intelligence and machine learning to develop highly secure, effective, and modular autonomous driving solutions. Specifically, WeRide’s solutions are aimed at robo-taxis, shuttles, and delivery vehicles, among others. Through rigorous testing and integration across the congested urban environment, WeRide seeks to democratize autonomous driving to decrease traffic intensity and increase road safety across the globe.

Company Strategy

The business model of the company lies in utilizing autonomous driving technology to revamp the means of transport in some of the busiest cities using sophisticated technologies like AI and ML. It highlights the top use case of becoming a technology partner of choice for automotive manufacturers, tech players, and city masterminds to blend with existing mobility value chains. The company also devotes ample time to roadway tests to conform to safety measures as well as legal requirements. Furthermore, it also seeks to increase its market demand around the world to realize efficient technological improvements and global applications intended to bring autonomous transportation to cities across the globe.

IPO Profile

 IPO Objective:

The main objective of the IPO is to expand its R&D efforts and expand its business operations domestically and internationally, with additional working capital needed to ensure smooth operations and for future opportunities, so it can speed up technology development, market presence and entrench its leading position in autonomous driving and gain a competitive advantage.

Application Process of IPO

To invest in NASDAQ, it is necessary to make use of a brokerage account. As a first step, enroll in a reliable brokerage firm that offers trading in NASDAQ, and fill out the registration form with your basic and financial information. In the next step, make some deposits into your account in preparation for buying shares. Enter the brokerage account trading division, identify the preferred stock, indicate the number of shares to be bought or sold, and select an order kind (Market, Limit, or Stop). Reiterate your order information and finalize the purchase.

Financial Analysis of the Company

WRD has a market cap or net worth of US$4.61 billion. The enterprise value is US$4.03 billion.

Financials in millions of CNY

 WeRide Inc.’s financial performance has fluctuated from 2021 to 2023. In 2023, the company reported revenue of CNY 401.84 million, down from CNY 527.54 million in 2022, yet still higher than the CNY 138.17 million recorded in 2021. The company’s gross profit in 2023 was CNY 183.48 million, a decrease from CNY 232.55 million in 2022. However, WeRide continued to face significant operating challenges, with an operating income loss of CNY 1,566 million in 2023. The net loss widened to CNY 1,949 million, compared to CNY 1,298 million in 2022 and CNY 1,007 million in 2021. The EBITDA and EBIT both stood at a loss of CNY 2,111 million in 2023. Despite growing revenue, WeRide Inc.’s widening losses and negative EBITDA and EBIT figures in 2023 suggest significant financial challenges that may impact its valuation and investor confidence in its IPO.

Competitor Analysis

Here are some of its top competitors:

Pony.ai

Pony.ai is a self-driving technology company established in 2016, and the primary business of the company is to develop solutions for self-driving technology. This company has its operational office in Silicon Valley, and it designs sophisticated self-driving technologies to promote safety and efficacy in conveyance routes. The company operates in China and the U.S., continuously striving to develop reliable and efficient self-driving technologies for multiple use cases including ride-hailing, delivery, and more. It is famous for innovations and decision-making based on its breakthrough achievements in the sphere of self-driving cars.

Momenta

Momenta is a Chinese technology company that specializes in autonomous driving solutions and artificial intelligence. It was founded to make concentrated efforts toward advanced perception, mapping, and decision-making technologies for self-driving vehicles. Among the innovations Momenta has provided are high-definition mapping and data-driven AI algorithms that will both enhance safety and the reliability of autonomous systems. The company works with partners in the automotive manufacturing and technology sectors to advance the safe integration of autonomous driving technologies into commercial and consumer applications.

AutoX

AutoX, a Chinese self-driving technology company founded in 2016, focuses on developing self-driving vehicle systems. It is an AI-driven solution company whose major role lies in strengthening safety, efficiency, and user experience in autonomous vehicles. AutoX runs the most well-rounded platform available for autonomous driving, which, among others, includes perception, decision-making, and control systems. It teams up with carmakers and technology partners to deploy its technology in ride-hailing services and other mobility scenarios, reimagining transportation with state-of-the-art autonomous driving solutions.

Apollo Auto

Apollo Auto is a subsidiary company of Baidu, established in 2017 as an open platform for autonomous driving technologies. It develops complex self-driving technologies such as perception and mapping technologies or AI-driven decision-making. Apollo Auto makes autonomous driving accessible and safe through the collaboration of an open-source platform, cooperating globally with vehicle manufacturers and technology partners to drive innovation. Serve a lot of use cases from ride-hailing to logistics.

DiDi

DiDi Global Inc. is a leading Chinese ride-hailing and mobility technology company. This company, established in 2012, offers ride-hailing and mobility services, including major car rental and leasing through its mobile app. DiDi operates worldwide, taking first place in China and gradually growing its presence overseas. It likewise invests increasingly in driving itself toward autonomous and electric technologies in the mobility solutions market. DiDi is attempting to transform the transportation industry by leveraging technology to achieve the most efficient and accessible mobility supply.

Waymo

Waymo is a leader in autonomous driving technology, formed in 2009, and belongs to Alphabet Inc. The company belonged to Google’s self-driving car project, working on advanced self-driving systems deployment. This also calls for state-of-the-art sensing, machine learning, and artificial intelligence to make safe and reliable self-driving cars. It offers an autonomous ride-hailing service in select cities across the US, questing to change transportation through innovation, mainly for betterment in mobility made possible by driverless.

Tesla

Tesla, Inc. is an American electric vehicle and clean energy company founded in 2003 and recognized for its innovations in automotive technologies. Tesla designs and manufactures electric cars, energy storage systems, and solar products. It has also developed an advanced driver-assistance system known as Autopilot, offering drivers semi-autonomous driving features. Fast Company ranked Tesla as one of the most innovative companies consecutively from 2013 to 2017. With its line of electric vehicles that run on its large network of renewable energy, it has disrupted several industries by creating efficient, sustainable, and accessible products for all people.

Details on Company Management

• Tony Xu Han – Founder, Chairman and Chief Executive Officer
• Yan Li – Co-founder, Director and Chief Technology Officer
• Duane Ziping Kuang – Director
• Mohamed Albadrsharif Shaikh Abubaker Alshateri – Director
• Jingzhao Wan – Director
• Takao Asami – Director
• Yibing Xu – Director
• Hua Zhong – Senior Vice President
• Jennifer Xuan Li – Chief Financial Officer
• Qingxiong Yang – Vice President

Manager/ Joint Manager of WeRide, Inc.

Morgan Stanley

Morgan Stanley, incorporated in 1935 and located in New York City, is a world-class financial services organization. It offers a plethora of services like investment banking, securities, wealth management, and investment management. The company caters to corporations, governments, institutions, and individuals from around the world. Morgan Stanley is a well-known company globally because it specializes in the field of financial markets, mergers and acquisitions, and capital raising. It is Morgan Stanley that uses its numerous branches and creativeness in financial operations to meet customers’ needs. The institution is bent on land sustainable expansion and green investing, playing a vital part in the financial sector by offering strategic consulting and financial services.

J.P. Morgan

J.P. Morgan is a leader in financial services, offering solutions to clients in more than 100 countries with one of the most comprehensive global product platforms available. Based in New York City, the company has services that cover investment banking and wealth management. The company provides companies, governments, and institutions with a broad range of findings worldwide for financial markets as well as mergers & acquisitions and capital raising, by leveraging its extensive network and innovative solutions that help in gaining a competitive advantage in the financial market.

CICC

China International Capital Corporation is an investment banking and financial services provider such as investment banking, asset management, and wealth management. CICC provides its services to capital markets, M&A, and financial advisory sectors for corporate enterprises, institutional investors, and government organizations. It has large exposure both within and outside China, thereby putting it among the key players within the global financial markets.

Co-managers of WeRide Inc

ABCI

Asia-Pacific Business Capital Inc. is a Hong Kong-based financial services firm, and it was established in 1984. The firm provides investment banking, asset management, and financial advisory services. Specialized in capital raising, mergers and acquisitions, and strategic financial planning, ABCI serves a broad spectrum of clients that ranges from corporations to institutions and government entities. ABCI has gained recognition for its unique Asia-Pacific market expertise by designing client-needs-driven financial solutions with strong regional insights to help clients achieve their business objectives.

BNP Paribas

BNP Paribas is a multinational banking and financial services company with its operational hub in Paris, France; it was founded in 1848. It is ranked among the biggest financial organizations in Europe and offers a whole spectrum of products and services including retail banking and wealth management, corporate and institutional banking, investment banking, and investment management. It provides its services to clients in different parts of the globe in the sphere of financial markets, mergers, and acquisitions, as well as wealth management.

Tiger Brokers

Tiger Brokers is an online brokerage firm that provides stock, options, and ETF trading on domestic and international exchanges. Tiger Brokers is an Australian-based financial technology start-up established in 2014 with a focus on offering cost-effective access and trading services to small investors. It has established a client base of young investors, especially from the Asian region, due to the incorporation of technology and analytics in trading. Tiger Brokers is a popular player in the field of online brokerage, where it has established its key strengths of being transparent in its operations and offering excellent customer care services.

Conclusion

WeRide Inc.’s upcoming IPO is a significant step toward its mission to develop autonomous driving technology. With its plans to raise $109.68 million, WeRide aims to accelerate its R&D efforts and expand its market presence both domestically and internationally. Despite financial challenges, the company’s focus on cutting-edge AI and ML technologies positions it as a key player in the rapidly growing autonomous vehicle industry. Investors should weigh the potential for growth against the financial hurdles as they consider this opportunity.