[Click eStock] "BYD Accelerates Spin-Off of Semiconductor Division"

[Asia Economy Reporter Eunmo Koo] There are expectations that the spin-off of BYD's (BYD·1211.HK) semiconductor division will accelerate.

BYD's stock price is gaining upward momentum due to policy momentum and optimism surrounding its battery and semiconductor divisions. At the Central Economic Work Conference, which concluded on the 18th, the 2060 carbon neutrality goal was emphasized as one of the eight key policies. As a result, on the 21st, Chinese new energy-related stocks broadly showed strength. On the same day, BYD announced through a public disclosure the current status of external sales of power semiconductors and batteries and mentioned the possibility of accelerating the spin-off of its business divisions, causing both A and H shares to surge more than 10%. Seunghye Baek, a researcher at Hana Financial Investment, explained in a report on the 23rd, “The current market interest lies not only in the short-term performance driven by strong sales of the model ‘Han’ but also in the successful market entry and spin-off listing timing of the battery and semiconductor divisions, which will be the core of mid- to long-term valuation rerating.”

The spin-off of the semiconductor division is also expected to accelerate. BYD is the only local electric vehicle company that has succeeded in developing power semiconductors independently. The power semiconductors developed by BYD, such as insulated gate bipolar transistors (IGBT) and SiC MOSFETs, are key components for optimizing power consumption in electric vehicles. Currently, in the Chinese IGBT market, Germany’s 'Infineon' holds an overwhelming 60% market share, while BYD holds 18%, ranking second.

Researcher Baek stated, “BYD’s SiC MOSFET technology was installed in this year’s new model ‘Han,’ making BYD the first global electric vehicle company after Tesla to do so. BYD spun off its semiconductor division in April this year and raised 1.9 billion yuan through Series A funding, with the subsidiary’s corporate value evaluated at 9.4 billion yuan.” The recent public disclosure mentioned the acceleration of the spin-off listing, and a corporate value reevaluation through listing is expected within the next one to two years.

Since BYD has proven its battery technology through the model ‘Han,’ external sales activation is also anticipated. Researcher Baek explained, “BYD’s LFP battery technology is gaining attention through the model ‘Han,’ which has achieved significant technological improvements with next-generation power semiconductors and CTP (Cell-to-Pack) technology. Discussions on external sales with automakers are also actively underway.” Contracts have been completed or are expected to be signed with Dongfeng Motor, Beijing Automotive, Changan Automobile, and Ford. In September this year, Daimler AG was reported to have discussed battery supply with BYD. The battery division was spun off in 2019 as 'Fudi Electronics,' and the market expects a spin-off within the next two to three years.

This content was produced with the assistance of AI translation services.