By Bloomberg News
Sept. 15 (Bloomberg) -- BYD Co., the Chinese maker of cars and batteries, is Asia’s best performing stock since Lehman Brothers Holdings Inc.’s collapse a year ago, helped by an HK$1.8 billion ($232 million) investment from Warren Buffett.
The company rose 7.3 percent to HK$66.60 in Hong Kong today, extending gains over the past year to 648 percent. That’s the biggest increase in the MSCI AC Asia Pacific Index. Chinese Gamer International Corp., the Taiwanese maker of online games, ranks second with a 563 percent increase. The wider index, tracking 978 stocks, is little changed.
BYD has soared since Buffett’s Berkshire Hathaway Inc. agreed to buy a stake in the company the same month that Lehman collapsed amid the global credit crunch. Buffett has made a $1.7 billion paper profit from the deal, as investors replicating his strategy and BYD’s rising car sales push up the share price.
BYD’s profit gained 98 percent in first half as it added new models and benefited from government tax cuts designed to revive industrywide demand. The Shenzhen-based company’s sales from the auto business more than doubled in the period to 8.88 billion yuan.
The tie-up with Buffett may help boost BYD’s profile overseas and also reassure potential customers, Chief Executive Wang Chuanfu said last year. The automaker started selling the F3DM, the world’s first mass-produced plug-in hybrid car, in December.
Berkshire’s MidAmerican Energy Holdings Co. bought 225 million new shares of BYD for HK$8 apiece in July. The Chinese company has said it plans to sell shares on the mainland to help fund development of its auto business.
BYD is also China’s biggest maker of rechargeable batteries, supplying power units to mobile-phone makers including Motorola Inc., Nokia OYJ, Samsung Electronics Co. and LG Electronics Inc.
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