THE WATCHLIST
By Peter Lisbygd
Many of you have requested concrete insights on Chinese companies to follow. This is the reason why we have created THE WATCHLIST.
A short form of inspiration and knowledge that may give you a better understanding of the future of business and your own investments. This time we focus on BYD and Futu Holdings.
BYD
Stock code: 002594
BYD (Build Your Dream) is one of the more well-established Chinese car manufactures. The latest hype on the Chinese NEV (New Energy Vehicle) market has often directed the spotlight on the newcomers in the sector such as NIO, X-PENG and Li-auto, companies that have all been listed in NYSE recently.
But BYD is much more than just a new energy car manufacturer. The group has two major subsidiaries, BYD Automobile and BYD Electronic - covering automobile, buses, trucks, forklifts, electric bicycles, batteries and solar panels, and they are among the global frontiers in various categories.
Domestic sale in China is booming despite the many newcomers in the NEV space. According to CNBC, BYD car sales rose 23% in May, from the previous month’s 31.681 units, of which 18.711 units were pure electric. In comparison, NIO delivered 6.711 cars in May, remaining well below that of BYD.
The Chinese NEV-market is by far the largest in the world and as we have mentioned in an earlier blog about China catapulting an entire NEV-industry. There is good reason to believe that the market in China will be dominated by local players
First 100 BYD Tang SUVs set sail for Norway. Photo www.bydeurope.com
This was also underlined recently when Reuters published the story on Apple being in early stage talks with Chinese battery giant, CATL, that we wrote about in our earlier WATCHLIST and BYD about the supply of batteries for its planned electric vehicle venture.
How this will play out is too early to say, but it is for sure interesting that Apple is discussing battery manufacturing in the US with leading Chinese battery manufacturers in times where political tensions between Washington and Beijing is also making the job harder for manufactures of the much-needed semiconductors in various sectors, including new energy vehicles.
BYD is already a dominant player on the global scene, but we will for sure see more global expansion and growth in the years to come. In my book, BYD is a good bet for a long-term investment in the green mobility sector.
FUTU Holdings
Stock code: FUTU
Futu Holdings is a Hong Kong based fintech company offering a fully digitized brokerage and wealth management platform. The company was established in 2011 and it was listed on Nasdaq in March 2019.
The company is catering for the growing demand of online investment from its primarily Chinese customer base. The number of registered clients has exceeded 2 million and the total userbase has grown to over 15 million. The growth rate for Q1 2021 show a staggering 349.4% growth from the same period last year.
I have been a frequent user of the “Futubull” application for the last few months and I admire their strong user-centric approach. I get information on the most relevant news and direct access to live earning calls from the companies of my interest, directly in the app. It is easy and convenient for me.
Futu is also gaining momentum in Singapore and the US and it might simply be one of the future winners in the online investment sector. Go and check it out for yourself!
*Disclaimer: We are not bankers or wealth managers, but experts with our ear to the ground, who are conveying knowledge and insights. As always, we are not advising on investment, and any mention of concrete companies should not be taken as investment advice in any capacity.
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