BYD Shares Jump after EV Maker Posts 200% Profit Surge

Shares of Chinese automaker BYD listed in China jumped more than 5% Tuesday, a day after posting a stellar increase in first-half profit.

Thanks to record deliveries, the Chinese electric car maker on Monday posted a 204.68% jump in net profit for the first half of the year — that’s net earnings of 10.95 billion yuan ($1.50 billion) in the January-to-June period, compared to 3.59 billion yuan a year earlier. 

Hong Kong-listed shares of the automaker rose 5.6% while stocks in Shenzhen were up as much as 4.75% on Tuesday.

The strong numbers were mainly attributable to rapid growth in the new energy-vehicle business, the firm said in a stock filing.

Revenue in the first six months increased by 72.72%, compared to the first half of 2022, according to the stock filing.

China’s top-selling car brand posted its best-ever quarterly sales results. Sales of passenger new energy vehicles in the second quarter were 700,244 units, up about 98% year-on-year, according to the company.

In comparison, U.S. rival Tesla reported deliveries of 466,140 vehicles globally for the second quarter.

Analysts agree that although the top line growth of BYD has been very strong, they are even more impressed by its gross margins, which stand at 18%, comparable with those of market-leader Tesla.

China is the largest auto market in the world by sales and production. It is also the largest EV market in the world and a key driver in the push toward electric cars. That said, BYD is coping well under pressure from price competition among domestic rivals as well as Tesla.