NIO Stock: Lawsuit From Singapore’s GIC Sends Shares Tumbling

TLDR

• Singapore’s sovereign wealth fund GIC filed a U.S. lawsuit against NIO, CEO Bin Li, and CFO Wei Feng
• GIC claims it purchased 54.5 million ADRs at artificially inflated prices between August 2020 and July 2022
• The lawsuit alleges NIO created a “superficially independent company” called Weineng Battery Asset Company to solve a 2020 liquidity crisis
• NIO shares dropped 13% in Hong Kong trading, marking the biggest one-day decline in approximately six months
• The stock had been up 56% in 2025 before the lawsuit news broke

NIO shares took a beating on Thursday after Singapore’s sovereign wealth fund filed a lawsuit against the Chinese electric vehicle maker. The stock plunged more than 13% in Hong Kong trading.

GIC filed the lawsuit in August in the U.S. district court for the southern district of New York. The fund claims NIO and two executives misled investors with false statements and withheld key business information.

The lawsuit names NIO, CEO Bin Li, and CFO Wei Feng as defendants. GIC is seeking damages for securities it purchased during a nearly two-year period.

According to the filing, GIC bought 54.5 million American depositary receipts between August 11, 2020, and July 11, 2022. The fund alleges these shares were trading at artificially inflated prices due to fraud.

NIO’s ADRs fell 7.3% to $6.32 ahead of the New York open on Thursday. The Hong Kong-listed shares dropped as far as HK$47, the lowest level since September 11.

The stock was the biggest percentage loser on Hong Kong’s Hang Seng Tech Index and Hang Seng Automobile Index. Those indexes fell 1.5% and 1.7% respectively.

The Battery Company at the Center

This entity, called the Weineng Battery Asset Company, purchased NIO’s leased batteries. The structure allowed NIO to immediately book revenue from those sales.

GIC claims this arrangement misrepresented the company’s true financial condition. The fund says investors were not properly informed about the nature of this business relationship.

Both NIO and GIC declined to comment on the lawsuit when contacted by reporters. The companies have not issued public statements about the legal action.

Recent Performance Takes a Hit

The timing of this news is particularly rough for NIO investors. The stock had been on a strong run heading into Thursday’s trading session.

As of Wednesday’s close, NIO’s ADRs were up 56% for 2025. That performance had far outpaced the S&P 500’s 13% gain over the same period.

Investors had been betting on NIO’s ability to capture market share in China’s premium electric vehicle segment. The company had been gaining momentum with new product launches and expanded production capacity.

The 13% single-day drop represents the stock’s worst performance in roughly six months. The decline erased a chunk of the year’s gains in a matter of hours.

News of the lawsuit first emerged in a Wednesday report from Caixin, a Chinese financial news magazine. The report detailed the claims filed in the U.S. court several months earlier.

GIC is one of the world’s largest sovereign wealth funds. The fund manages Singapore’s foreign reserves and invests across multiple sectors including technology and infrastructure.

The lawsuit was filed in the U.S. district court for the southern district of New York in August 2025.

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