Shares of Chinese electric vehicle maker Nio Inc ( NIO ) – ADR are trading higher Thursday morning, mounting a recovery from a nearly 10% plunge on Wednesday. The sell-off was triggered by the announcement of a $1 billion equity offering to raise fresh capital.

What To Know: The offering, priced at $5.57 per ADS, rattled investors Wednesday due to concerns over the dilution of existing shares. The company is issuing approximately 181.8 million new Class A ordinary shares.

However, market sentiment shifted as investors digested the strategic purpose of the capital injection. Nio has stated the proceeds will be used to fund crucial research and development in smart EV technologies, develop new vehicle models and expand its innovative battery-swapping and charging network.

The funds are also earmarked for strengthening its balance sheet for general corporate purposes. The ADS portion of the offering is slated to close today, September 11, with the ordinary share offering expected to close around September 17.

Benzinga Edge Rankings: While Benzinga Edge stock rankings show a modest Momentum score of 46.79, the platform also indicates a positive price trend for the stock across short, medium and long-term outlooks.

Price Action: According to data from Benzinga Pro, NIO shares are trading higher by 5.6% to $6.04 Thursday morning. The stock has a 52-week high of $7.71 and a 52-week low of $3.02.

Read Also: NIO, XPeng, Li Auto Log Strong August Deliveries Highlighting China's EV Momentum

How To Buy NIO Stock

Besides going to a brokerage platform to purchase a share – or fractional share – of stock, you can also gain access to shares either by buying an exchange traded fund (ETF) that holds the stock itself, or by allocating yourself to a strategy in your 401(k) that would seek to acquire shares in a mutual fund or other instrument.

For example, in NIO’s case, it is in the Consumer Discretionary sector. An ETF will likely hold shares in many liquid and large companies that help track that sector, allowing an investor to gain exposure to the trends within that segment.

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