Reports suggest that BYD may be preparing a large sale of share stock to raise cash.
Bloomberg reported that the stock sale could amount to the equivalent of 20% of its Hong Kong-listed shares.
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Citing anonymous sources the report said BYD has submitted an application with the China Securities Regulatory Commission, but not yet made pubic.
The article said the funds would give BYD room to step up investments and increase production of electric cars and buses. It also said that selling shares would help alleviate the strain on a balance sheet that’s been hit by higher net debt.
The Bloomberg report noted that the share sale would come as BYD braces for lower profit this quarter because of declining demand for its conventional powertrain vehicles. Analysts note that domestic brands in China have been suffering as Western brands made locally in joint ventures have grown volume.
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