China's Jiangxi Ganfeng Lithium Co. Ltd. generated US$421 million from its IPO on the Hong Kong stock exchange, Reuters reported Oct. 4, citing a source involved in the deal.

The company priced the offering at HK$16.50 per share, at the bottom end of an indicative range of up to HK$26.50, the source told Reuters.

Ganfeng declined to comment.

The company could raise up to $448 million if an overallotment option is exercised once shares start trading Oct. 11.

The weak pricing coincides with an oversupply of lithium that has lowered prices even as demand for the metal is expected to increase when electric cars become more mainstream. Lithium is used for making batteries used in electric vehicles.

Ganfeng recently signed a three-year deal to supply about 20% of its lithium output to U.S. electric carmaker Tesla Inc.

According to Reuters, the company plans to use proceeds from the Hong Kong listing to acquire lithium resources and expand its production capacity of lithium metals, batteries, compounds and recycling.