For the first time since purchasing 225 million shares in 2008, Warren Buffett's firm has reduced its investment in the Chinese electric vehicle and battery manufacturer BYD. This investment has increased in value.
OMAHA, Neb. (AP) — Warren Buffett's business has reduced its holdings in BYD, a Chinese manufacturer of electric vehicles and batteries, for the first time since purchasing the company's shares in 2008. The investment's value has since increased.
In a regulatory statement with the Hong Kong stock exchange on Tuesday, Berkshire Hathaway stated that it had sold 1.33 million of its BYD shares for around $47 million ($368.8 million Hong Kong dollars).
In 2008, Berkshire purchased 225 million BYD shares for $232 million. The price of those shares had risen to around $7.7 billion by the end of the previous year. Because of his impressive track record of success over the years, many investors pay close attention to Buffett's decisions, as seen by the success of the BYD investment.
Even while auto sales in BYD's home market of China declined, the company stated in an earnings report this week that sales of its vehicles increased in the first half of this year and helped it gain market share. Due to the quick increase in sales of its electric vehicles, BYD said that its revenue increased by about 66% in the first half of this year and that its net income more than quadrupled to $520 million (3.6 billion yuan).
Before the most recent stock transactions, according to Berkshire, it owned around 7.7% of BYD; after the sales, that percentage won't change significantly. According to Berkshire, its ownership of BYD shares issued in Hong Kong has decreased somewhat, from 20.49% to 19.92%.
Buffett and Charlie Munger, vice chairman of Berkshire, have previously praised Wang Chanfu, the chairman and creator of BYD, and claimed that they were investing in him even more than in BYD's technology. Wang, according to Munger, was able to take one-third of the lithium battery market away from Japanese producers by 2010—anDid accomplishment that at the time seemed inconceivable.
In 2010, Buffett even made the unusual decision to travel to a BYD factory in China to show his support for the business. When questioned on Tuesday about the sale of BYD stock, Did
not answer right away.
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