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Kandi jumps as 2015 Chinese electric car sales exceed forecast
[NEW YORK] Kandi Technologies Group Inc rose from the lowest level since October after the company said it sold more electric vehicles than targeted last year as China pushes the use of alternative-energy transportation.
The American depositary receipts increased 1.6 per cent to US$8.86 in New York on Tuesday, the biggest gain this year. The stock has slumped 39 per cent from last year's high in March.
Kandi, which previously forecast 2015 sales from its joint venture with Geely Automobile Holdings Ltd.would range from 20,000 to 22,000 units, rebounded as the company said they exceeded that target by 5 per cent or more.
About 1 per cent of the 21.1 million passenger cars sold in the country last year were electric powered, according to data compiled by the China Association of Automobile Manufacturers and Bloomberg Intelligence.
The government is pouring billions into subsidies, development grants and infrastructure to support the alternative-fuel vehicles, according to Steve Man, a Hong Kong- based analyst covering the auto industry at Bloomberg Intelligence.
"Kandi will benefit in the long term as China is making a strong push to combat air pollution and meet ever-more stringent emission standards in the next five years," Mr Man said by e-mail.
Kandi's partner Geely is targeting new-energy vehicles to make up 90 per cent of sales by 2020. Jinhua, Zhejiang-based Kandi in November also signed agreements with big names such as Alibaba Group Holding Ltd and Uber China to promote connected electric cars.
"Given the robust growth in China's EV industry we anticipate the strong momentum in the sector to continue in the next few years, which will substantially benefit our business," Hu Xiaoming, Kandi's Chairman and Chief Executive Officer of Kandi, said in the company's statement Tuesday.
BYD Co, which is partly owned by Warren Buffett's Berkshire Hathaway Inc and also makes electric cars, gained 3.5 per cent to US$4.78 in US over-the-counter trading. A Bloomberg gauge of the most-active US-traded Chinese stocks rose 2.2 per cent to 114.73, the biggest jump since Oct 30.
The Deutsche X-trackers Harvest CSI 300 China A-Shares ETF, the largest US exchange-traded fund that tracks mainland Chinese stocks, added 2.2 per cent to US$24.19.