Key Takeaways
- • Xiaomi, through wholly-owned subsidiary Hanxing Venture Capital, invested 1.7 billion yuan (approximately $256.0 million) in Sunwoda Power for a 5.34% stake, making it the third-largest shareholder, per Sunwoda's announcement on October 29.
- • The deal follows Li Auto's 2.65 billion yuan (approximately $399.0 million) capital increase in September, which diluted Li Auto's stake from 8.79% to 8.32%; combined automaker capital into Sunwoda Power exceeds 4.3 billion yuan (approximately $647.4 million).
- • Sunwoda will hold no more than half of Sunwoda Power's board seats after the transaction, so it loses control and Sunwoda Power will be deconsolidated from its financial statements.
- • Sunwoda Power posted a 2025 net loss of approximately 3.169 billion yuan (approximately $477.2 million) and a first-half 2026 net loss of about 324 million yuan, with total liabilities above 57.2 billion yuan.
- • Parent Sunwoda's first-three-quarter 2026 net profit fell 56.37% year on year to about 613 million yuan, while it terminated its Hong Kong H-share listing plan; shares fell 4% to 16.06 yuan on October 30.
Summary
Sunwoda (300207.SZ) disclosed on the evening of October 29 that its power battery subsidiary, Sunwoda Power Technology Co., Ltd., completed a new round of capital increase. Xiaomi, via Hanxing Venture Capital, contributed 1.7 billion yuan to acquire a 5.34% stake, becoming Sunwoda Power's third-largest shareholder. Following the round, Sunwoda Huizhou New Energy Co., Ltd. fell from 24.06% to 22.78% and remains the largest shareholder, while Li Auto, diluted from 8.79% to 8.32%, ranks second.
The transaction follows Li Auto's 2.65 billion yuan capital increase approved in September, which subscribed to 1.4 billion yuan of newly registered capital. The two automakers had earlier formed Shandong Li Auto Battery Co., Ltd., a 50-50 joint venture for Li Auto's self-developed batteries. Xiaomi already works with Sunwoda as a core supplier for its "Dragon Armor Battery," including customized cells and dedicated lines for its Pengcheng series; the equity stake converts that supply relationship into a capital tie. Sunwoda said the move will deepen collaboration on technology R&D, capacity support and market expansion.
The ownership change also alters control. Per the announcement, Sunwoda will hold no more than half of the board seats after the new board is elected, and Sunwoda Power will become an associate company no longer consolidated into Sunwoda's financial statements. Sunwoda said the capital injection will strengthen Sunwoda Power's financial position, lower its debt-to-asset ratio and ease its debt burden.
Sunwoda Power remains loss-making. Revenue exceeded 20 billion yuan in 2025 against a net loss of about 3.169 billion yuan; in the first half of 2026, revenue was about 15.529 billion yuan, with a net loss of roughly 324 million yuan and total liabilities above 57.2 billion yuan. At the parent level, first-three-quarter 2026 revenue rose 45.78% to about 63.462 billion yuan, but net profit attributable to shareholders fell 56.37% to about 613 million yuan. Third-quarter net profit was only about 10.57 million yuan, down 98.08%. On an October 29 investor call, executives blamed weaker consumer electronics demand, rising material costs, yuan appreciation, lower export tax rebates and consumption tax.
On the same day, Sunwoda terminated its plan to issue H-shares and list on the Hong Kong Stock Exchange main board, citing market conditions and its development plans, and said the move would not materially affect operations. Shares closed down 4% at 16.06 yuan on October 30, a market value of about 29.67 billion yuan (approximately $4.5 billion).
Industry context: according to the China Automotive Battery Innovation Alliance, CATL led September domestic power battery installations with 32.51 GWh and a 42.81% share, while Sunwoda ranked sixth with a 3.6% share, down 0.33 percentage points month on month. The investments are seen by industry observers as a way for Li Auto and Xiaomi to secure bargaining power and capacity within a supply landscape dominated by CATL, while whether the capital improves Sunwoda's balance sheet and narrows losses depends on capacity ramp-up and order fulfillment.
The transaction follows Li Auto's 2.65 billion yuan capital increase approved in September, which subscribed to 1.4 billion yuan of newly registered capital. The two automakers had earlier formed Shandong Li Auto Battery Co., Ltd., a 50-50 joint venture for Li Auto's self-developed batteries. Xiaomi already works with Sunwoda as a core supplier for its "Dragon Armor Battery," including customized cells and dedicated lines for its Pengcheng series; the equity stake converts that supply relationship into a capital tie. Sunwoda said the move will deepen collaboration on technology R&D, capacity support and market expansion.
The ownership change also alters control. Per the announcement, Sunwoda will hold no more than half of the board seats after the new board is elected, and Sunwoda Power will become an associate company no longer consolidated into Sunwoda's financial statements. Sunwoda said the capital injection will strengthen Sunwoda Power's financial position, lower its debt-to-asset ratio and ease its debt burden.
Sunwoda Power remains loss-making. Revenue exceeded 20 billion yuan in 2025 against a net loss of about 3.169 billion yuan; in the first half of 2026, revenue was about 15.529 billion yuan, with a net loss of roughly 324 million yuan and total liabilities above 57.2 billion yuan. At the parent level, first-three-quarter 2026 revenue rose 45.78% to about 63.462 billion yuan, but net profit attributable to shareholders fell 56.37% to about 613 million yuan. Third-quarter net profit was only about 10.57 million yuan, down 98.08%. On an October 29 investor call, executives blamed weaker consumer electronics demand, rising material costs, yuan appreciation, lower export tax rebates and consumption tax.
On the same day, Sunwoda terminated its plan to issue H-shares and list on the Hong Kong Stock Exchange main board, citing market conditions and its development plans, and said the move would not materially affect operations. Shares closed down 4% at 16.06 yuan on October 30, a market value of about 29.67 billion yuan (approximately $4.5 billion).
Industry context: according to the China Automotive Battery Innovation Alliance, CATL led September domestic power battery installations with 32.51 GWh and a 42.81% share, while Sunwoda ranked sixth with a 3.6% share, down 0.33 percentage points month on month. The investments are seen by industry observers as a way for Li Auto and Xiaomi to secure bargaining power and capacity within a supply landscape dominated by CATL, while whether the capital improves Sunwoda's balance sheet and narrows losses depends on capacity ramp-up and order fulfillment.
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