China Fuel-Cell Startup Seeks Funds, Predicts Hydrogen-Car Boom

China’s push for more fuel-cell vehicles is inspiring startup Anhui Mingtian Hydrogen Energy Technology Co. to step up its growth, with the technology provider working on fresh fundraising en route toward an initial share sale.

Mingtian is talking to investors and plans to raise about 200 million yuan ($30 million) at a valuation of as much as 2 billion yuan by the end of the first half next year, Chairman Wang Chaoyun said in an interview in Beijing. The company wants an initial public offering on Shanghai’s Star Board in three years, he said.

While there are few hydrogen cars on China’s roads, the government unveiled the first national policy this year that’s aimed at boosting demand for the environmentally friendly vehicles. Annual sales of fuel-cell vehicles in China are set to rise by 10 times in five years to 50,000 units before hitting half a million by 2035, Wang estimated.

“The government polices are like a blessing” for the industry, Wang said. “The market is heating up.”

China has been providing subsidies to buyers of fuel-cell vehicles since 2009, but demand has been low. As of July, there were only about 7,200 fuel-cell automobiles in use and 80 hydrogen charging stations in the country. That compares with millions of battery-electric cars, seen as an alternative to hydrogen vehicles.

In September, the government announced new steps to accelerate the fuel-cell segment’s growth. Among the measures, it said it is introducing rewards to cities that carry out hydrogen-vehicle pilots.

Mingtian, which means bright sky in Chinese, develops fuel-cell stacks and other inner workings for hydrogen vehicles. The company expects to have its stacks installed in 2,000 vehicles in 2022 and about 10,000 vehicles in 2025, Wang said.

— With assistance by John Liu, and Ying Tian

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