BYDs 1Q Profit Slumps 85 Share Jumps

BYD's 1Q Profit Slumps 85%...Share Jumps!

BYD Company (1211.HK), a Chinese new-energy-vehicle (NEV) maker, reported that first-quarter net income slumped 85.0% on year to 113 million yuan.

The Company attributed the fall in first-quarter revenue (-35.1% on year to 19.68 billion yuan) to the COVID-19 outbreak and macroeconomic downturn.

However, BYD is optimistic over the current (second) quarter. It said: "The impact of COVID-19 on the domestic market is expected to gradually subside, and the automobile industry will recover steadily. (...) it is expected that the NEV sales and revenue of the Group will ride out the downturn, thereby driving the Group’s revenue to resume growth. Meanwhile, the continued decrease in the NEV cost will also help enhance the Group’s profitability."

Encouraged by the Company's upbeat outlook, investors bought up the stock this morning, driving it up over 9.0% as compared to yesterday.

On a Daily Chart, BYD has shot above the Upper Bollinger Band, calling for further upward acceleration.

Source: GAIN Capital, TradingView

Upside Resistance is expected at HK$51.00 and HK$55.50 (the High in February).

In fact, BYD is continuing a "V-Shape" rebound from a low of HK$33.50 on March 23.

Key support is located at HK$43.20 (around the 50-day moving average).

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