Renault lays out EV unit Ampere’s growth ahead of hotly anticipated IPO
Renault is forecasting more than €25bn (£21bn) in revenues from its Ampere electric vehicle unit, ahead of a much anticipated listing.
Renault has forecast more than €25bn (£21.7bn) in revenue from its Ampere electric vehicle unit by 2031, ahead of a much anticipated listing next year.
The french carmake is laying out plans for the unit’s IPO a bid to win over investors at a capital markets day today. The IPO would take place in the first half of 2024, subject to “favourable market conditions.”
Renault said it is targeting revenue of at least €10bn in 2025, eventually reaching €25bn in 2031. There are seven electric vehicle launches planned by Ampere over this period.
The automaker’s plot to spin out its electric vehicle and software arm as Ampere, is one of the most hotly anticipated European IPO’s. Renault’s chief executive Luca de Meo suggested the division could command a €10bn valuation in September.
But some analysts are not confident carving it out is the right decision at all. Jefferies said in a note earlier this week they had “strong reservations” about an Ampere IPO, putting a valuation figure at between €5-7bn .
The last three years have been “challenging” for pure EV manufacturers, the note read. “Renault will certainly argue it has a faster path to profitability for Ampere and higher valuation, but we believe an IPO would dilute existing shareholders from future value drivers.”
Boss De Meo has warned that Europe’s automotive industry is being hamstrung by over-cautious investors, with traditional carmakers struggling to compete with huge valuations offered in the US to unproven EV start-ups.
The Vietnamese group VinFast broke records earlier this year after a Nasdaq-listing which saw its valuation briefly surpass the likes of Ford and Boeing.
The potential Ampere IPO is part of Luca de Meo’s plan to separate Renault into five segments – a plan he began soon after his appointment in 2020. Alongside the new Ampere unit, the chief executive has proposed separating Renault’s combustion engine business, a 50/50 joint venture with China’s Geely.
The Ampere plan has faced complications in the form of increased Chinese competition in the European EV market, and unfavourable market conditions across the continent.
De Meo said today he was “confident” in its success. “Ampere is an ambitious holistic and structural response of the European industry to the challenges coming from East and West.”
Renault’s chief financial officer Thierry Piéton said the company was aiming for 30 per cent average annual revenue growth.
“The IPO is an opportunity to further accelerate the development of Ampere without drawing on Renault Group resources and it allows Renault Group to accelerate on the roadmap to reward its shareholders.”
Shares were trading up 1.23 per cent on the Paris Stock Exchange.
