BYD removed from Hang Seng China Enterprises Index

by Ray Jing   2012-11-22

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 http://www.chinaautoreview.com/pub/CARArticle.aspx?ID=8156
 

HONG KONG – The compiler of Hong Kong’s stock indexes said in the middle of November it will kick BYD out of Hang Seng China Enterprises Index, or H-share index, from December 10 this year, stock.hexun.com reported.
The elimination is a move made by the compiler after its quarterly review on the performance of company. The Warren Buffett-backed BYD was added to the Index in September 2009.
Analysts say the move is not unexpected based on the poor profit performance of BYD.

According to BYD earnings report for the third quarter of 2012, in the first nine months, net profits slumped 94.08 percent year-on-year to ¥20.88 million ($3.35 million), while revenues dipped 3.57 percent to ¥3.31 billion.
In a statement filed with Shenzhen Stock Exchange, officials said third quarter net profits were ¥4.61 million, a 94.04 percent year-on-year decline.
Due to the slowdown of economy, BYD expects its net income for the whole year to shrink from ¥1.38 billion in 2011 to between ¥27.7 million and ¥110 million this year, said the statement.
The Shenzhen-based company attributed the poor performance to the gloomy global solar energy cell market and a stagnant mobile phone industry.
It also said the slowed automotive market added pressure to its vehicle business, which contributes to half of its revenues.