BYD (1211 HK) Short-term Profit under Pressure, and Long-term Growth Potential October 14, 2019 69

PSR Recommendation: ACCUMULATE Status: Maintained
Target Price: HKDHKD44

Investment Summary
Decreased Sales Volume of New Energy Vehicles in July/August Due to Many Factors
The advance consumption caused by the subsidy decline overdraws the demand for China NEVs in H2. The macro-economy is weak. The China-US trade dispute has suppressed the potential purchase demand of some consumers. The wait-and-see atmosphere is strong. The rapidly developing NEV market in recent years has also begun to be affected. BYD, as the industry leader, is also facing an impact. On the other hand, the subsidy policy changes in the last year led to “low before and high after” of its NEVs sales. We expect that the yoy growth rate from H2 will hardly improve under the trend of “high before and low after” this year. BYD’s sales of NEVs decreased by 11.8% in July and 23.4% in August to 16,567 and 16,719, respectively.

About the author

Profile photo of Zhang Jing

Zhang Jing
Phillip Securities (HK)

Bachelor Degree in Tongji University of Engineering; Master Degree in East China Normal University of finance. Currently covering the automobile and air sectors. She has years of experience in investment research and is good at combining analysis for the companies with industry prospects.

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