Buffett Sells BYD Shares in China Consecutively... Will He Cut Losses After 14 Years of Long-Term Investment?

[Image source=Yonhap] [Image source=Yonhap News]

[Asia Economy Reporter Yujin Cho] The stock price of Chinese electric vehicle company BYD is showing weakness. This comes amid renewed speculation that Warren Buffett's investment firm Berkshire Hathaway will completely divest its stake in BYD for the first time in 14 years.

Bloomberg reported on the 5th that BYD's stock price on the Hong Kong Stock Exchange plunged 6.8%, falling to its lowest level since May 10. On the same day, the stock also dropped more than 2% intraday on the Shenzhen Stock Exchange in mainland China before partially recovering. BYD is dual-listed on both the Hong Kong and Shenzhen exchanges.

According to the report, BYD's stock price has fallen about 30% since speculation about Buffett's stake sale first emerged in July.

According to a report submitted to the Hong Kong Stock Exchange, as of the 1st, Berkshire Hathaway's stake in BYD decreased from 19.92% to 18.87% (207 million shares).

Buffett invested $230 million in 2008 to purchase 225 million shares of BYD and did not sell a single share until he sold twice within about a week after the 24th.

Earlier, on July 24, Buffett sold 1.33 million shares of BYD, reducing his stake from 20.04% to 19.92%.

Market insiders view Buffett's recent stake sales not as profit-taking but as a step toward gradual liquidation.

Kevin Lau, an analyst at Daiwa Capital Markets in Hong Kong, said, "This selling behavior appears to be Buffett's move to completely divest his stake in BYD," adding, "This will be a factor putting pressure on BYD's stock price in the short term."

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