{"id":30735,"date":"2022-09-03T12:03:37","date_gmt":"2022-09-03T16:03:37","guid":{"rendered":"http:\/\/autosector.com\/?p=30735"},"modified":"2022-09-03T12:03:37","modified_gmt":"2022-09-03T16:03:37","slug":"berkshire-hathaway-sells-byd-shares","status":"publish","type":"post","link":"http:\/\/autosector.com\/?p=30735","title":{"rendered":"Warren Buffett\u2019s Berkshire offloads more shares in Chinese EV giant BYD | Autoblog"},"content":{"rendered":"

Warren Buffett\u2019s Berkshire Hathaway Inc. trimmed its stake in BYD Co. even further, offloading another 1.72 million shares as of Sept. 1, according to an exchange filing Friday, just days after the legendary U.S. investor began reducing his holding in China\u2019s biggest maker of electric vehicles.<\/span><\/p>\n

Berkshire\u2019s interest in BYD\u2019s Hong Kong-listed shares has now fallen to 18.87% from 19.02%, with the latest securities sold for an average of HK$262.72 apiece, giving the stake a value of around HK$450.8 million ($57.5 million). That takes Berkshire\u2019s total shares jettisoned to 3.05 million, or 1.4% of Buffett\u2019s known 225-million-share holding.<\/p>\n

Theories about Buffett\u2019s plans for the bellwether Chinese electric car<\/a> company have swirled since a 20.49% stake \u2014 identical to the size of Berkshire\u2019s last reported BYD position in Hong Kong as of the end of June \u2014 entered the Central Clearing and Settlement System in July, a sign to investors a sale may be imminent. That triggered the biggest slump in BYD stock in nearly two years.<\/p>\n

\u201cWe may see some continued selling from Buffett,\u201d Daisy Li, a fund manager at EFG Asset Management HK Ltd., said. \u201cIn the short term, it will be hard for investor sentiment surrounding BYD\u2019s Hong Kong shares to recover, while its shares listed onshore may be less affected. In the long term, the share performance will still depend on company fundamentals and product cycles.\u201d<\/p>\n

News of the actual first sale on Tuesday afternoon sparked renewed selling, with BYD stock falling almost 13%, before clawing back half almost half of the declines. The shares, which jumped 31% last year and an impressive 423% in 2020, are down 14% this year.<\/p>\n

A BYD official, in comments earlier this week to Chinese newspaper the 21st Century<\/a> Business Herald, said there\u2019s \u201cno need to over interpret\u201d the stake sale, and added the company\u2019s operation remains as normal.<\/p>\n

According to calculations<\/a> based on BYD\u2019s interim report and the investor\u2019s latest filings, Buffett has sold about 18 million shares since June 30 through Sept. 1, suggesting there may be more public disclosures to come. Berkshire, which first bought 225 million shares in September 2008, has been by far the largest shareholder in the EV giant.<\/p>\n

The Buffett-BYD offloading came days after BYD reported robust financial earnings for the six months ended June 30, with net income tripling to the top end of forecast. Revenue, though, fell short of estimates.<\/p>\n

BYD, regardless of whether or not Buffett continues to be a backer, is in a commanding position. It\u2019s China<\/a>\u2019s biggest maker of electric cars with a market share approaching 30% and is the world\u2019s third-largest battery<\/a> maker. The Shenzhen-based firm is also selling record numbers of cleaner cars.<\/p>\n

Bloomberg Intelligence analysts Steven Man and Joanna Chen said in a research note on Aug. 31 that BYD\u2019s growth momentum remained strong despite Buffett\u2019s stake sale. They pointed to the deep vertical integration that allows BYD to boost production and secure higher EV profits while peers jostle for cost-effective parts and supplies.<\/p>\n

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