Shanghai (ZXZC)- On Aug. 21, Chinese EV startup NIO reportedly had suffered substantial valuation shrink, which ranged between $ 27 to 29 billion, compared with the previous valuation of $ 37 billion.

Just one week ago, NIO, backed by Chinese tech heavyweight Tencent, officially filed for a $1.8 billion IPO and applied for going public on the New York Stock Exchange under the symbol "NIO", according to its filing with the Securities and Exchange Commission. The IPO is being handled by Morgan Stanley, Goldman Sachs, and several other major banks.

It is noteworthy that NIO targets to tenfold its price-earnings ratio over next five years. According to the valuation from its IPO roadshow, the EV maker should gain a net profit ranging between $800 million and $1billion in 2023.

Founded in 2014, NIO has never gained any profits by far. As of now, NIO raised $2.4 billion (about RMB16.5 billion) funding in total. During these four years, it suffered expanded loss growth. According to its IPO filing, NIO posted a net loss of RMB 3.33 billion in the first six months of 2018, while accumulating RMB 45.991 million in revenue. By far, NIO underwent cumulative loss of RMB 10.92 billion. The increasing loss and sluggish net profit will continue to exert great pressure for NIO to fulfil its target of tenfold price-earnings ratio within five years.