HONG KONG: Shares of BYD Co. surged as much as 4.4% in Hong Kong this week, pushing their premium over the company’s Shenzhen-listed stock to a record high, highlighting rising confidence among foreign investors in the Chinese electric vehicle giant.
The Hong Kong-listed stock is now trading at a more than 5% premium to its mainland counterpart, after adjusting for currency conversion, according to Bloomberg data. The surge comes amid market enthusiasm following Contemporary Amperex Technology Co.‘s highly anticipated public debut.
The widening gap between BYD’s dual listings is particularly notable, as mainland A-shares generally trade at a 33% premium to their Hong Kong equivalents, according to the Hang Seng Stock Connect China AH Premium Index.
The trend reflects BYD’s status as a favoured stock among global investors, especially at a time when dual-listed companies typically see stronger valuations onshore. Analysts say the premium is further supported by stronger offshore liquidity and the company’s position as a “quality core holding” for international portfolios.
“While the mainland’s overall premium over Hong Kong shares is likely to persist, select names like BYD and China Merchants Bank are showing inverse trends due to foreign investor interest,” noted James Wang, strategist at UBS AG.
The performance underscores foreign investors’ growing conviction in BYD’s long-term prospects, positioning the automaker as a rare standout in a mixed market for Chinese equities.–BLOOMBERG
