BYD Shareholders Confront a Fork in the Road: Record Exports Meet a 78% Stock Rout

BYD posts record overseas shipments but domestic sales tumble 24%; seeks approval to issue 737M new shares and up to 50B RMB debt, while offering a dividend.

The numbers coming out of BYD could hardly be more contradictory. While the Chinese automaker shipped a record 160,644 vehicles overseas in May — an 80% jump that pushed exports to 42% of total sales — its domestic business lost ground sharply, with home-market deliveries sliding 24% to roughly 222,809 units. Over at the Shenzhen headquarters today, shareholders are being asked to approve two capital-raising mandates that would add fresh risk to a stock already trading near a 52-week low of EUR 9.51.

The board wants authorisation to issue up to 20% of the current H-share float, or about 737 million new shares. On top of that, BYD is seeking the green light to raise as much as 50 billion renminbi through a mix of short-term instruments, corporate bonds and convertible notes, plus a guarantee framework of up to 150 billion renminbi for subsidiaries. Proceeds are earmarked for working capital and investment. For existing holders, the combination spells potential dilution and a thicker balance-sheet burden — all while the equity has cratered 78% from its June 2025 peak of EUR 44.99.

Against that backdrop, management is dangling a dividend as a sweetener. The proposed final payout of 0.358 renminbi per share — totaling roughly 3.26 billion renminbi — will go to a vote on the same ballot. The ex-dividend date is set for June 11, with a book-closure period from June 15 to 18 and payment due by the end of July. Non-resident corporate shareholders face a 10% withholding tax, while individual investors under the Southbound Connect program are taxed at 20%; foreign retail holders are temporarily exempt.

The company’s operating performance tells a tale of two markets. In China, the broader EV market expanded 12% to 1.36 million vehicles in May, yet BYD’s home sales contracted, meaning it is ceding market share on its home turf — precisely where it once dominated. Cumulatively, the group sold 1.405 million units in the first five months, still more than 20% below the year-ago period. The export boom has not been enough to offset the domestic slide.

Management is fighting back with technology. BYD has begun producing the Xuanji-A3 chip, a 700-TOPS processor that costs roughly one-third of comparable Nvidia products. The company is passing that saving to customers: its driver-assistance system is priced at around $1,770 in China, versus nearly five times that for Tesla’s equivalent package. And in a move Tesla has so far avoided, BYD is assuming full financial liability for accidents that occur while its assisted-driving system is active.

Analysts remain broadly bullish despite the headwinds. The average price target on the H-shares stands at roughly 124 Hong Kong dollars, and 25 of 26 covering analysts rate the stock a buy, with just one sell recommendation. The current H-share price of about EUR 9.77 — barely 2.8% above the 52-week trough — leaves plenty of room for a rebound if the company can navigate the domestic pricing war that has already slashed first-quarter net profit by 55%.

For shareholders, today’s vote sets the direction. Approve the capital plan and the existing stake gets watered down; reject it and BYD may need to tap other, costlier sources of funds. Either way, the market’s next move will likely hinge on how the dividend discount plays out after June 11 — and whether the export surge can eventually close the widening gap at home.