Electric cars charge up $1.8 bln BYD share sale - Reuters

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People stand near a BYD X Dream electric vehicle (EV) displayed during a media day for the Auto Shanghai show in Shanghai, China April 19, 2021. REUTERS/Aly Song

HONG KONG, Nov 1 (Reuters Breakingviews) - Investors snapped up new shares in the $128 billion Chinese electric-car maker BYD (002594.SZ), , covering the books multiple times, IFR reported on Monday. A 6.9% discount to Friday’s close made them hard to resist, despite disappointing resultsreleased the same day. Earnings fell by 28% year-on-year in the third quarter, and its net profit margin was less than 1% after stripping out one-offs like government grants. Although the company claims around half of its revenue from an eclectic assortment of mobile handsets, medical masks and solar panel products, autos and their batteries make up the rest and sales of its new-energy vehicles are booming. BYD’s market share was second only to Tesla (TSLA.O)in September, per Bernstein. It also has a unique advantage over Musk’s marque: BYD produces its own batteries and semiconductors, providing some protection against snarled supply chains. As enthusiasm for its battery-powered car business grows, so too does the case read more for spinning it off and unlocking value. (By Katrina Hamlin)

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Editing by Una Galani and Thomas Shum

Reuters Breakingviews is the world's leading source of agenda-setting financial insight. As the Reuters brand for financial commentary, we dissect the big business and economic stories as they break around the world every day. A global team of about 30 correspondents in New York, London, Hong Kong and other major cities provides expert analysis in real time.

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