NIO (09866.HK) shares plunged 5.38% in Hong Kong trading on Friday, following news of the company's plans for a stock offering. The electric vehicle maker's U.S.-listed shares had already dropped 7.7% in the previous session, signaling investor concerns over potential share dilution.

The sharp decline comes as NIO announced its intention to raise capital through a stock offering, a move that often leads to a decrease in share value due to the increased supply of shares in the market. While the exact details of the offering have not been disclosed, such plans typically aim to raise funds for various purposes, including research and development, expansion of production capabilities, or strengthening the company's financial position.

This significant drop in NIO's stock price reflects the market's immediate reaction to the potential dilution of existing shareholders' stakes. Investors will likely be closely watching for further details on the size and terms of the stock offering, as well as how NIO plans to utilize the raised capital to drive future growth and improve its competitive position in the increasingly crowded electric vehicle market.