(Yicai Global) July 18 -- Sokon Industry Group, a Chinese carmaker that is partnering with telecoms giant Huawei Technologies on new energy vehicles, has secured CNY7.1 billion (USD1.1 billion) from the private sale of new shares led by mutual fund firm GF Fund Management. The stock price has already jumped over 40 percent since the sale.

Sokon’s stock price [SHA:601127] closed up 1.7 percent at CNY75.20 (USD11.15) today, a 44.7 percent gain on the new share issuance price of CNY51.98. The stock has surged 90 percent in value since May due to strong sales of its new energy vehicles.

Seventeen investors participated in the private placement, Sokon said on July 15. Guangzhou-based GF Fund was the biggest investor, pumping in CNY1.5 billion (USD222.4 million), while brokerage Citic Securities was not far behind with CNY1.2 billion.

After the transaction, parent firm Sokon Holding’s stake has been diluted to 28.4 percent from 30.5 percent, the carmaker added.

The funds raised will be used to develop more NEV models, enhance research and development in new technologies, upgrade the automation level of plants, build production lines for electric drive systems, construct users’ centers as well as supplement working capital, it said.

In the first half, Sokon’s NEV sales tripled from the same period last year to 45,600 units. As of the end of June, shipments of its M5 model, the first car in its high-end AITO series launched with Huawei last December, reached 18,317 units.

Despite the jump in sales, the Chongqing-based company is expecting its losses to nearly quadruple in the first half year on year to as much as CNY1.7 billion (USD252 million) due to its huge investment in the R&D of new auto models. Revenue, though, is forecast to jump by as much as 70.6 percent over the period to CNY12.6 billion (USD1.8 billion).

Editor: Kim Taylor