- Earnings will be lower after up to $2.4 billion sale, BYD says
- China securities regulator said to suspend share-sale reviewsB
BYD Co. fell for a second day in Hong Kong trading, heading for its lowest close in more than a month, after disclosing that regulatory approval is holding up its proposed share sale and will reduce earnings.
The stock fell as much as 6.4 percent to HK$42.40 and traded at HK$43.40 as of 10:50 a.m. in Hong Kong. BYD is headed for the lowest close since Oct. 5, after slumping 8.3 percent on Tuesday. The benchmark Hang Seng Index was little changed.
BYD, which counts Berkshire Hathaway Inc. as a shareholder, said in June that it planned to raise as much as 15 billion yuan ($2.4 billion) and spend the proceeds on expanding capacity to produce batteries for new-energy vehicles and research and development. The share sale was held up as China’s securities regulator was said to have suspended reviews of initial public offerings and other share sales to contain a summer market rout.
Earnings per share will drop due to the time lag between when the share sale is approved and the completion of the projects funded by the proceeds, BYD said in a statement.
Chinese automakers are raising funds for research and development to meet China’s stricter emission and fuel efficiency standards for the next few years. SAIC Motor Corp. said this month it plans to raise as much as 15 billion yuan through a private share sale to develop its own brands and new-energy vehicles.
— With assistance by Kongho Chua