The Chinese car market is continuing to heat up and take another stab at rival Tesla, with the latest entrant getting a $3.35 billion boost in funding.

The electric car unit of Evergrande (0708.HK) raised funding through a share sale by issuing 952.38 million shares at $27.30 Hong Kong dollars each to six investors, sending its stock price surging over 67% on the Hong Kong Exchange, CNBC reported.

Evergrande raised net proceeds of 26 billion Hong Kong dollars ($3.35 billion) from the share sale, CNBC said. Investors now hold a 9.75 stake in the company, sending the EV unit’s valuation up from $17 billion to $151 billion, which Financial Times said was now higher than Ford’s current $45.8 billion valuation.

The value of Evergrande’s electric vehicle unit is also worth more than its parent company, which also saw its share price increase by 8% on Monday, giving it a valuation of $28.8 billion, according to FT.

However, under its electric car unit, Evergrande has not sold any EVs to date. The automaker did unveil six electrified vehicles under the Hengchi name in 2020 and is expected to begin production on the vehicles later this year.

Evergrande is just the latest carmaker in China to rear its head and take aim against Tesla, Nio, Li Auto, and Xpeng Motors. But some have concerns over Evergrande’s ability to make it in the world’s biggest and crowded EV market.

Evergrande is clouded with 75 billion yuan in debt as of June, which Nigel Stevenson, an analyst at Hong Kong-based accounting investigation firm GMT Research, told Financial Times, “Evergrande Auto remains primarily a property company,” adding that the company’s largest cash outflow last year was investment in properties that were under development.

Evergrande is still preparing to list on the Shanghai Nasdaq-style Science and Technology Innovation Board or the Star Market, CNBC said.

Shares of Evergrande’s electric care unit were trading at $45.350 as of market close on Monday, up $15.450 or 51.67%.

Chinese-made cars waiting to be loaded on a ship for export in Lianyungang, in China's eastern Jiangsu province. The IMF has trimmed China's growth forecast for 2019 on the back of the trade war with the US and weak domestic consumer demand
Chinese-made cars waiting to be loaded on a ship for export in Lianyungang, in China's eastern Jiangsu province. The IMF has trimmed China's growth forecast for 2019 on the back of the trade war with the US and weak domestic consumer demand AFP / STR
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