F-1/A: WeRide Revs Up IPO Plans, Eyes Nasdaq Listing Amid Autonomous Driving Boom

WeRide Inc., a leading autonomous driving technology company, is pursuing an initial public offering to list its American Depositary Shares (ADSs) on the Nasdaq Stock Market.

Summary

• WeRide Inc., a Cayman Islands-based holding company, is planning an IPO to list on the Nasdaq under the symbol WRD.
• The company is offering 6,452,000 ADSs, with each ADS representing three Class A ordinary shares, and anticipates an initial public offering price between US$15.50 and US$18.50 per ADS.
• Concurrently with the IPO, certain investors have committed to purchase US$320.5 million in Class A ordinary shares through private placements.
• Robert Bosch GmbH has expressed interest in purchasing up to US$100 million of the ADSs in the offering.
• WeRide's revenue for 2023 was RMB401.8 million (US$55.3 million), a decrease from RMB527.5 million in 2022, while the net loss for 2023 was RMB1,949.1 million (US$268.2 million).
• The company plans to use the IPO proceeds for research and development, commercialization, capital expenditures, and general corporate purposes.
• WeRide faces legal and operational risks associated with operating primarily in mainland China, including regulatory oversight and data security concerns.
• The company's dual-class share structure will give its founders significant control over corporate matters.

Sentiment

Score: 6

Explanation: The document presents a mixed sentiment. While it highlights WeRide's leadership and technological advancements in the autonomous driving industry, it also acknowledges financial losses and risks associated with operating in mainland China. The potential for growth and commercialization is balanced by the challenges and uncertainties inherent in the industry.

Positives

• WeRide has a commercially successful L4 autonomous driving business with operations in 30 cities across seven countries.
• The company has a universal, scalable, and smart technology platform (WeRide One) that supports various autonomous driving applications.
• WeRide has strong partnerships with key ecosystem participants, including OEMs and Tier 1 suppliers.
• The company has a visionary management team and a world-class team of 2,227 employees, approximately 91% of whom are R&D staff.
• WeRide has a robust cash runway, driven by a go-to-market strategy that ensures stable cash flow.

Negatives

• WeRide experienced a revenue decrease in 2023 compared to 2022, with revenue dropping from RMB527.5 million to RMB401.8 million (US$55.3 million).
• The company has a history of net losses, with a loss of RMB1,949.1 million (US$268.2 million) in 2023.
• WeRide faces risks associated with operating in mainland China, including regulatory oversight and data security concerns.
• The company's dual-class share structure concentrates voting power in the hands of its founders, limiting investor influence.

Risks

• WeRide has a limited operating history and financial track record in the emerging autonomous driving industry.
• The company faces challenges in developing and commercializing its autonomous driving technology.
• The market for autonomous driving products and services is relatively new and disruptive.
• WeRide's operations are subject to extensive and evolving governmental regulations.
• The company's business generates and processes a large amount of data, requiring compliance with privacy and cybersecurity laws.
• The PCAOB had historically been unable to inspect WeRide's auditor in relation to their audit work.
• WeRide's ADSs may be prohibited from trading in the United States under the HFCAA in the future if the PCAOB is unable to inspect or investigate completely auditors located in China.
• Changes in China's economic, political, or social conditions or government policies could have a material adverse effect on WeRide's business and operations.

Future Outlook

WeRide aims to commence commercial production of its robotaxis and achieve readiness for large-scale commercialization in 2024 and 2025, respectively, and expects its product sales to recover gradually in the next two years.

Management Comments

• We believe WeRides autonomous driving technology is among the most advanced and commercially proven in the world, designed to cater to a broad spectrum of scenarios from urban environments to highways.
• From day one, we decided to tackle the challenges of commercial viability, practicability and scalability of autonomous driving.
• We believe innovation does not flourish in a vacuum, but rather must be applied in real world settings.

Industry Context

The autonomous driving market is expected to see tremendous growth, with the global market reaching US$1,745 billion by 2030. L4 autonomous driving is expected to dominate the market, accounting for 88% of the overall autonomous driving market globally in 2030.

Comparison to Industry Standards

• WeRide is the most commercially successful L4 autonomous driving company globally as measured by commercialization revenue in 2021, 2022 and 2023.
• WeRide is the only autonomous driving company in the world to obtain test permits for autonomous driving vehicles in four countries.
• WeRide is the first company in the world to offer paid L4 robotaxi services to the public with the longest operation track record.
• WeRide is the first company in the world to develop a purpose-built L4 robobus designed for open road, as well as the first to launch driverless robobus services on open road to the public.
• WeRide is the first company in the world to develop an L4 robovan dedicated to intra-city delivery of goods and to obtain test driving permit for the robovan on open roads.
• WeRide is the first company in the world to develop a purpose-built L4 robosweeper designed for open road as well as the first to launch driverless robosweeper urban cleaning services.
• WeRide is the first autonomous driving company in the world to accumulate 10,000 purpose-built L4 autonomous driving vehicle orders, and the most advanced in commercialization milestones across industries.
• WeRide is the only autonomous driving company to achieve mass production of an ADAS solution within 18 months into development, the quickest among peers.

Related Party Transactions

• WeRide has engaged in transactions with related parties, including Yutong Bus Co., Ltd., Alliance Automotive R&D (Shanghai) Co., Ltd., and Guangzhou Yuji Technology Co., Ltd.
• These transactions include sales of goods and services, purchases of goods and services, and payments made on behalf of customers.
• The company has a nominating and support agreement with Alliance Ventures, B.V., Dr. Tony Xu Han, and Dr. Yan Li, which will become effective upon the completion of this offering.

Stakeholder Impact

• Shareholders will be subject to a dual-class share structure, limiting their ability to influence corporate matters.
• Employees may benefit from the company's share incentive plan.
• Customers may benefit from the company's autonomous driving products and services, which aim to improve safety, efficiency, and quality of life.
• The company's operations are subject to regulatory oversight, which may impact its ability to offer securities to investors.

Next Steps

• WeRide aims to commence commercial production of its robotaxis and achieve readiness for large-scale commercialization in 2024 and 2025, respectively.
• The company intends to build on its technological and business milestones as a global leader to advance towards full commercialization across all use cases.
• WeRide will continue to innovate and maintain its leadership in autonomous driving technology by improving its algorithms and by refining and building up the technical maturity of its autonomous driving products.
• The company plans to continue to expand its global presence by providing its robust autonomous driving products and services with compelling value propositions.

Key Dates

Keywords

autonomous driving, WeRide, IPO, robotaxi, robobus, robovan, robosweeper, ADAS, Nasdaq, China, commercialization, technology, regulation, investment, mobility