By PANG Yu

Berkshire Hathaway Inc., the multinational conglomerate owned by business magnate Warren Buffett, has sold 2.5 million shares in EV maker BYD at HK$ 267 (246 yuan, US$34) per share, cashing out HK$676 million, according to HKEX.

Since August 2022, Berkshire Hathaway has cut its stake in BYD 12 times and now holds 9 percent of BYD's equity, down from 20 percent last year. Industry insiders reckon Berkshire Hathaway is in the process of liquidating all of its BYD shares.

“Once you hold less than 5 percent in an HK-listed company, you no longer have to disclose reduction moves anymore,” said YAN Zhaojun, an analyst from financial holding group Zhongtai International.

Berkshire Hathaway bought 225 million BYD shares in 2008 for HK$1.8 billion and typically for Buffet's investments, didn’t change its position for 14 years. Buffett himself has been a cheerleader for BYD, going so far as to attend events such as new car launches to show his support of the company.

Recently Buffett has had direct exposure to moves in Asian economies. BYD was Berkshire Hathaway's biggest single investment outside of the United States. Asia now accounts for much of the growth in the Berkshire Hathaway portfolio and is the main source of continuing enthusiasm surrounding Buffett's next moves.

In June last year, Berkshire Hathaway was the fourth largest shareholder in BYD, the top three being an HKEX subsidiary HKSCC Nominees Ltd., founder and CEO of BYD Wang Chuanfu, and LU Xiangyang, current president of BYD.

The regular reductions since last year have brought in roughly HK$27 billion for Berkshire Hathaway. That's a profit somewhere north of HK$25 billion. Both A-share and H-share prices of BYD reached all-time highs in June 2022.

Following 92-year-old Buffett's reduction in holdings, the H-share price of BYD initially fell and then rose. In less than two months, from August to October, the H-share price dropped from a high of HK$271 to a low of HK$160. But in the following eight months, the stock price recovered to a high of HK$273 on June 16.

BYD’s A-shares on the other hand, have plummeted 27 percent since last year's June high to 260 yuan by Tuesday.

The latest sell off by Berkshire Hathaway had only a limited impact on the BYD share price, since most investors have already accounted for the moves.