Yahoo Finance Citi opens upside catalyst watch on BYD; sees strong exports, domestic markets
Investing.com-- Citibank analysts opened a 30-day upside catalyst watch on BYD Co's (SZ:002594) Hong Kong shares (HK:1211) on Wednesday, stating that lower-than-feared EU import tariffs and strong domestic demand presented tailwinds for the company.
The EU said it will impose higher import tariffs on Chinese electric vehicles, ranging from 17% to 38%. But tariffs on BYD were at 17%, much better than the 30% projected by Citi.
The lower tariff bodes well for BYD’s market share gain in the EU, Citibank analysts said. They also forecast that BYD’s exports to the EU will account for one-fourth to one-third of its overall sales in 2024.
The brokerage also flagged strength in domestic sales, with BYD seeing strong order intake in recent weeks, which heralds stronger sales in the second and third quarter.
Citi also expects BYD to make a profit of at least 8,000 yuan ($1103) on each vehicle sold.
BYD shares rose sharply on Thursday following the EU tariffs, rising 6% by the afternoon break to HK$233.40.
Citi rates the stock Buy with a target price of HK$475.0- representing an over 100% upside from current levels.
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