Hong Kong needs more charging facilities as EV sales are expected to more than double by 2025, installer Cornerstone Technologies says

Hong Kong had 27,860 registered private EVs, or 4.2 per cent of the total number of registered private cars, in January
‘We expect the penetration to reach around 10 per cent in a few years’, Cornerstone CEO Vincent Yip tells the Post

Electric & new energy vehicles

Eric Ng

Published: 1:30pm, 17 Apr 2022

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Hong Kong needs to catch up on electric vehicle (EV) charging facilities to meet demand, as EV use could more than double to 10 per cent by 2025, according to Cornerstone Technologies.

“Hong Kong’s EV fleet has been growing at 30 to 40 per cent per year in the past few years,” Vincent Yip Siu-hong, the CEO of Cornerstone, a key installer in the city, told the Post. “We expect the penetration to reach around 10 per cent in a few years.”

Hong Kong had 27,860 registered private EVs in January, accounting for 4.2 per cent of a total of 656,438 registered private cars, according to Transport Department data.

Cornerstone, which entered the charging infrastructure business in 2016, has fitted 1,500 charging points in various government and privately owned car parks, around a third of the total number installed in the city. It aims to install at least 1,000 charging points in 50 to 70 housing estates in the next 12 months, Yip said.

Cornerstone has fitted 1,500 charging points in various government and privately owned car parks in Hong Kong since 2016. Photo: KY Cheng

It has already installed charging facilities in estates developed by the Hong Kong Housing Society, Henderson Land Development, MTR Corporation and New World Development (NWD), as well as seven shopping centres managed by real estate private-equity firm Gaw Capital Partners and bus depots owned by KMB.

By designing, sourcing, selling and installing EV charging equipment for property owners, it recorded a gross profit margin of 23.8 per cent last year.

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Cornerstone has also invested in some of the facilities it has fitted at more than 20 properties owned by third parties. It charges users monthly fees or on a pay-as-you-go basis, with a target to make an annual return of at least 20 per cent.

“We want to generate cash flows by selling equipment to fund our business growth, and at the same time build a stream of recurring income from charging facilities rentals, maintenance and software licensing,” said Yip, a former CEO of NWD’s K11 Cultural Enterprise.

Cornerstone has fitted charging facilities at seven of the more than 20 shopping centres invested in by strategic partner Gaw Capital in Hong Kong, and will seek to do so in the rest as well.

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Through a fund it manages, Gaw Capital together with partners in late 2017 bought 17 housing estates linked with shopping centres in Hong Kong from Link Asset Management for HK$23 billion (US$2.9 billion). The assets include more than 8,000 parking spaces.

Gaw Capital last month granted Cornerstone an 18-month HK$150 million loan facility carrying an interest rate of 10 per cent, to fund the latter’s charging point fitting projects that are also supported by government subsidies.

The Hong Kong government in October 2020 launched a HK$2 billion scheme to subsidise charging infrastructure installation for more than 60,000 parking spaces in existing private residential buildings. An additional HK$1.5 billion of support was announced in this year’s budget, as part of the city’s efforts to become carbon neutral by 2050 and fight climate change.

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A fund managed by Gaw Capital has been granted the rights to purchase Cornerstone shares that could see it own an up to 29.6 per cent stake if all the rights are exercised. The subscription price is 50 Hong Kong cents a share. Cornerstone shares closed at 97 Hong Kong cents on Thursday.

Cornerstone last month signed a non-binding memorandum of understanding to form a joint venture with conglomerate Golden Cambodia Century, with an initial target to set up and operate 10 charging points at shopping centres and gas stations in Cambodia. Cornerstone is expected to own 51 per cent of the venture.

“Southeast Asia is a market where we want to make a heavy development push,” Yip said. “We are in talks on potential projects with various parties.”