BYD shares surge 10% following Xi's remarks

Shares in electric-car producer BYD Co surged to the daily limit of 10 percent on the Shenzhen Stock Exchange on Monday, after President Xi Jinping made remarks that the sector should be attached more importance in the future.

Experts noted that Xi's remarks may mean that more subsidies and favorable policies will be given to the sector.

Boosted by the news, shares of new-energy car related companies surged on the A-share market on Monday.

Shares in Sichuan Chengfei Integration Technology Corp, a lithium battery producer, also surged to its daily limit on Monday.

BYD Co, backed by business magnate Warren Buffett, said Saturday that it agreed to place up to 121.9 million H shares at HK$35 ($4.5) per share, or HK$4.267 billion in total and the proceeds will be used to fund the development of the company, said a filing on the Shenzhen bourse.

The company's shares on the Hong Kong bourse also rose 0.36 percent on Monday.

In the filing, the company also said that new-energy cars represent the direction of the sector's future development.

BYD also said in the filing that its electric bus has secured orders from several local cities including Nanjing, Tianjin and Dalian, as well as some overseas orders.

The company is also expanding the production capacity for its hybrid sedan model Qin, and total sales of the model is expected to reach 20,000 units this year, media said earlier this month.

Several cities including Shanghai and Xi'an have released detailed rules to promote new-energy cars.

Shanghai authorities said on May 20 that besides the central government's subsidy, the city will give a 40,000 yuan ($6,404) subsidy to each pure electric car owner and 30,000 yuan to each hybrid car owner.