Chinese electric vehicle maker BYD announced on Tuesday that it had raised $5.59 billion through a primary share sale, the largest of its kind in Hong Kong in four years.
The company sold 129.8 million primary shares, up from the initial 118 million shares planned when the deal launched on Monday. Despite the increase in size, BYD’s Hong Kong shares opened down 8%, reflecting the discount at which the shares were sold.
The transaction is the largest equity follow-on offering in the global automotive sector over the past decade. Key investor Al-Futtaim Family Office from the United Arab Emirates has also shown interest in forming a strategic partnership with BYD, though the exact investment amount was not disclosed.
While the Middle East remains a relatively small market compared to China, Chinese automakers, including BYD, have increasingly focused on expanding their presence there.
BYD, which became China’s largest automaker in 2022, has been ramping up its production of affordable electric vehicles. In 2024, the company’s sales hit 4 million cars, with over 90% of sales in China, where it commands more than a third of the market for pure electric and plug-in hybrid vehicles.
The shares were priced at HK$335.20 ($43.11) each, representing a 7.8% discount to the closing price on Monday. The deal is the largest in Hong Kong since 2021, when Meituan raised $6.9 billion. BYD plans to use the proceeds from the share sale to fund research and development, expand its international operations, and support working capital.
The automaker is targeting global sales of 5 to 6 million cars in 2025, aiming to rival companies like General Motors and Stellantis. BYD is also accelerating its expansion, with nearly 1 million employees as of September, surpassing the workforce sizes of Toyota and Volkswagen.
BYD’s share sale comes amid a positive sentiment in the Hong Kong and Chinese markets, especially in the tech sector. The company has been ramping up its export efforts, with Brazil being its largest overseas market in 2024.
In Europe, BYD has introduced new hybrid models to offset the 17% tariff on its electric vehicles.
Citigroup analysts noted that raising funds in Hong Kong will help BYD expedite its international expansion, as the company faces challenges in transferring RMB from China and obtaining necessary approvals for capital spending abroad. Goldman Sachs, UBS, and CITIC Securities led the share sale.
