The Chinese automaker backed by Warren Buffett, BYD Co. LTD, on Wednesday said that the chairman of the company has increased his stake and even has plans to buy more shares as a sign of confidence in the company due to the record slump that the stock experienced last week.
The BYD chairman, CEO and president, Wang Chuanfu, purchased 1 million of the Hong Kong listed BYD shares on Tuesday. He now owns 23.1% of the company, and this was mentioned in a statement posted on the Hong Kong and Shenzhen stock exchanges.
“Mr. Wang has indicated that he does not rule out the possibility of further increasing his shareholding in the company if and when appropriate in the future,” said BYD.
The move tells the market and investors that Wang “has confidence toward the future prospects of the company,” we learned according to statements.
The Hong Kong shares of BYD dropped by 29% recently in record trading, and this was the biggest one-day drop that the company has ever experienced. And the slide in share price was relatively unexplained. This drop caused the company to lose $1.2 billion of its market capitalization.
Since then, shares have stabilized after the company had calls with analysts. They also issued statements saying the fundamentals of the company have remained quite healthy.
The statements from BYD were made once the Hong Kong and China markets closed.
On December 24, shares went up by 3.5%. The Shenzhen stock had risen by 4.3%, so a steady bounce back and stabilization has begun.