NIO Stock – Buffett-Backed Electrical-Automobile Maker BYD Raises Virtually $Four Billion

Chinese language electric-vehicle (EV) maker BYD (OTC:BYDDY) has raised $3.9 billion by promoting new shares on the Hong Kong market, in accordance with The Wall Street Journal. The automaker initially deliberate to lift $3.6 billion, however elevated the provide, making the most of excessive investor curiosity within the sector. 

Different rising Chinese language EV firms, together with NIO (NYSE:NIO) and XPeng ((NYSE:XPEV)), have additionally lately raised contemporary capital as stock costs have soared. XPeng raised nearly $2.5 billion final month, whereas NIO has added greater than $4.5 billion to its steadiness sheet since December in two separate choices. 

BYD Han electrical sedan. Picture supply: BYD.

Warren Buffett first invested in BYD in 2008, and Berkshire Hathaway (NYSE:BRK-A) (NYSE:BRK-B) has 25% possession within the firm. The automaker bought nearly 131,000 battery-electric autos (BEVs) in 2020, and greater than 460,000 autos total. Although its BEV gross sales had been down 11% in 2020, BYD outsold rivals like NIO, which delivered 43,728 whole autos in 2020. 

Buyers are betting that EV progress in China will proceed, and have been piling into these firms’ shares over the previous yr. NIO is now valued at about the identical degree of BYD, after its stock has gained greater than 1,000% over the previous yr. 

BYDDY information by YCharts.

Chinese language EV makers are elevating cash to extend manufacturing capability as China goals to provide 5 million EVs by 2025, in comparison with about 1.1 million in 2020.