HONG KONG (Reuters) -Chinese electric vehicle giant BYD (SZ:002594) on Tuesday said it expects third-quarter net profit to as much as double thanks to robust sales and effective cost control.
The Shenzhen-based company forecasts net profit for the July to September period at between 9.55 billion yuan ($1.31 billion) and 11.55 billion yuan, an increase of 67% to 102% from a year earlier.
"Despite the increasingly intensified competition in the automobile industry in the third quarter, the company continued to record profit," BYD said in a filing.
This was down to the company "leveraging on its improving brand influence, continuously expanding scale advantage and strong industrial chain-wide cost control capability, demonstrating strong resilience", it said.
Net profit in the nine months through September is expected to rise 120-142% year-on-year to between 20.50 billion yuan and 22.50 billion yuan, it said, up from a net profit of 9.31 billion yuan in the year ago period.
Citi analyst Jeff Chung said the previous consensus likely failed to capture elements such as BYD's much higher return on investment from exports and how it had further achieved cost reductions. He said he remained bullish on BYD into 2024 citing strong export sales and resilience in domestic price cut cycles versus its competitors.
Shares were up 6.89% in Hong Kong trading on Wednesday morning.
BYD's new energy vehicle (NEV) sales hit a record high in the third quarter, with the company ranking first in the world in terms of NEV sales, it said.
The company sold 824,001 NEVs in the third quarter, up 53% from a year ago, company data showed.
Last week, BYD said it had agreed to sell 2,000 electric buses to Uzbekistan, and will team up with the Tashkent Municipal government to promote the electrification of public transportation in the capital.
($1 = 7.3118 Chinese yuan renminbi)