Buffett's China visit could bode well for BYD

Warren Buffett (2nd R), Charles Thomas Munger (2nd L), BYD's President Wang Chuanfu (L) and BYD's Vice President Xia Zhibing (R) attend a ceremony to celebrate the selling of BYD's millionth vehicle, in Shenzhen, south China's Guangdong Province, Sept. 27, 2010. Billionaire investor Warren Buffet began a three-and-half-day visit to China on Monday, in which he will take part in a series of marketing events of BYD, the fast growing Chinese electric car producer he has invested in, and visit BYD's new energy research center, Xinhua learnt from a schedule obtained from Shenzhen-based BYD. Photo: Xinhua

Billionaire investor Warren Buffett will spend much of his three-and-half day visit to China at BYD, the fast growing Chinese electric car producer he has invested in.

After arriving in China's boom town of Shenzhen Monday afternoon, Buffett was scheduled to take part in a series of BYD marketing events and visit BYD's new energy research center, Xinhua learnt from a schedule obtained from Shenzhen-based BYD.

The value of Buffett's investment in BYD has risen six-fold.

Buffett's Berkshire Hathaway Inc. bought 10 percent of Hong Kong-listed BYD (short for "Build Your Dreams") for $230 million two years ago. That stake is now worth as much as $1.7 billion.

Reuters on Friday quoted Andrew To, sales director at Tai Fook Securities, as saying Buffett may break the news he plans to sell down his stake in the company during his visit, since the company's stock value is well off its peak of last October and that the return on his investment is impressive enough.

BYD issued a statement Saturday saying reports that suggested Buffett may reduce his stake in the company were not based on fact.

Analysts' opinions differ.

Huang Yonghe, chief analyst with China Automotive Technology & Research Center, said during his China visit, Buffett is expected to reaffirm his support for BYD and very likely he would increase his investment in relevant sectors in China.

Buffett will attend a ceremony to celebrate BYD's inking of a deal to build electric charging stations with China Southern Power Grid.

He is scheduled to visit BYD's plants in the cities of Shenzhen and Huizhou on Tuesday and then leave for Beijing on Wednesday, where he will co-host with Bill Gates a charity banquet to meet about 50 wealthy Chinese.