BYD shares surge amid China’s green vehicle push

BYD shares surge amid China’s green vehicle push

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Shenzhen-based battery and automaker BYD (1211.HKG), part-owned by Warren Buffett's Berkshire Hathaway (BRK.NYSE) saw its strongest surge in Hong Kong trading in three years thanks to China’s accelerated efforts to encourage the development of electric vehicles, Reuters reported. Stock in the maker of the E6 electric car climbed 26% to HK$20.85 on Monday, the biggest gain since September 29, 2008. Beijing declared the electric vehicle industry a top priority late last week, earmarking US$1.5 billion a year for the next 10 years to boost the clean vehicle industry and handpicking 25 cities to draw up plans to push EV sales. But several analysts were skeptical of the resulting rise in BYD's stock price. "The upside for BYD should be limited," said Daiwa Securities analyst Jeff Chung, adding that BYD's E6 electric car would account for about 2% of the company's production capacity next year and the real pick-up in green car sales in China would not start until late 2012 or 2013.