BYD, the Chinese electric carmaker partly owned by Warren Buffett’s Berkshire Hathaway, climbed to an eight-month high in Shenzhen trading on speculation the government is close to unveiling plans to boost demand for new energy vehicles, an analyst said.
“There’s been a rumor in the market today that the government’s new-energy car plan will come out as soon as next week, which could be a factor in giving BYD a boost,” Yang Zao, a Shanghai-based analyst with KGI Securities, said in a telephone interview. Yang yesterday raised his price estimate for BYD’s Hong Kong-listed shares to HK$21.50 from HK$14.60.
BYD’s A shares surged as much as 8.3 percent to 31.11 yuan, its highest intraday level since August 3. In Hong Kong, the stock climbed as much as 4.4 percent to HK$21.30.
China, the world’s largest polluter, is preparing to unveil plans to develop its alternative-energy auto market as it seeks to cut smog and reduce its reliance on imported oil. General Motors, Daimler AG and Volkswagen AG have announced plans to introduce new-energy vehicles in China, where Boston Consulting Group estimated in June that sales of electric cars will exceed those of the US by 2020.
BYD shares may also be getting a boost from media reports, such as the one on Beijing Business Today that cited BYD Chairman Wang Chuanfu as saying the company will double warranties to four years or 100,000 kilometers (62,150 miles) for its vehicles. That may improve consumers’ perceptions about the quality of BYD cars, he said.
