Chinese automaker BYD has raised $5.59 billion through a primary share sale in Hong Kong, marking the city’s largest equity offering since 2021. The company expanded the deal’s size from an initial plan of 118 million shares to 129.8 million, reflecting strong investor interest.
The offering was priced at HK$335.20 ($43.11) per share, an approximate 7.8% discount from its previous closing price. BYD’s stock dropped 8% in early trading following the sale, mirroring the discount.
Strategic Investors and Overseas Expansion
A key investor in the deal was the UAE-based Al-Futtaim Family Office, with BYD announcing plans to explore a strategic partnership with the firm. While details of the investment were not disclosed, the partnership aligns with BYD’s broader efforts to expand into the Middle East.
Despite the company’s growing international ambitions, China remains its dominant market. In 2024, BYD sold over 4 million vehicles, accounting for more than a third of China’s electric and plug-in hybrid market. The company aims to sell 5 to 6 million cars in 2025, putting it on par with global competitors like General Motors and Stellantis.
Rising Market Confidence and Policy Support
The successful share offering comes amid improved investor sentiment in Hong Kong and China, particularly in the technology sector. A recent summit led by Chinese President Xi Jinping signaled increased government support for private businesses, contributing to a 36% rise in BYD’s Hong Kong-listed shares this year.
Proceeds from the offering will be used for research and development, international business expansion, and general corporate purposes. BYD has been ramping up production capacity and hiring additional staff to support its growth. As of September, the company employed nearly 1 million people, surpassing major automakers like Toyota and Volkswagen.
Challenges in Global Markets
While BYD continues its international push, regulatory and trade barriers remain obstacles. In Europe, its electric vehicles now face an additional 17% tariff, prompting the company to focus on hybrid models. Brazil emerged as BYD’s largest overseas market in 2024, underscoring its strategy of diversifying sales beyond China.
