BYD’s European Expansion Gains Momentum Amid Market Skepticism

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While BYD shares have faced significant pressure in recent months, a strategic operational counteroffensive is now taking shape. New developments in manufacturing and a notable valuation gap highlighted by analysts suggest the market's bearish sentiment may be overlooking key strengths.

Construction is officially underway at BYD's planned facility in Manisa, western Turkey. Photographic evidence of earth-moving equipment and initial groundwork confirms the project's launch. This site is a cornerstone of the company's strategy; by leveraging Turkey's customs union with the European Union, BYD can potentially circumvent the EU's punitive tariffs on electric vehicles manufactured in China.

The plant is designed for an annual production capacity of 150,000 vehicles. However, with construction commencing later than initially anticipated, meeting the original target for production to begin by the end of 2026 appears ambitious. Progress is also being made at the company's other European site in Szeged, Hungary, where trial production is scheduled to commence within the current first quarter.

Analysts Spot a Glaring Valuation Anomaly

Concurrently, the company has received supportive analysis from Bernstein SocGen Group. The firm recently reaffirmed its "Outperform" rating for BYD, accompanied by a price target of 130 HKD. Their rationale is striking: the current total market capitalization of BYD approximates the standalone value of its battery division alone.

This implies that the market is currently assigning a near-zero valuation to BYD's core automotive manufacturing, semiconductor, and electronics businesses. According to the analysts, investors are mistakenly viewing BYD purely as an automaker, thereby ignoring its diversified industrial portfolio.

Financial Performance and Market Disconnect

This perceived value has yet to be reflected in the stock's performance. Since its 52-week high, the share price has declined by approximately 40%, recently closing below the 95 HKD mark. Although the company's sales growth slowed to 7.7% in 2025, it achieved a significant milestone by surpassing Tesla in annual sales of pure battery electric vehicles (BEVs) for the first time.

Investor attention is now turning to March 30, 2026. On this date, BYD will release its fourth-quarter results, which must demonstrate whether it can maintain profitability amidst intense price competition and new EU pricing regulations.