The $230 million investment made by Warren Buffett's Berkshire Hathaway Inc. (BRK-A) for a 10% stake in China's BYD Co. in 2008, is paying off. BYD, which focuses on green-energy cars and batteries, reported a healthy profit of 2.3 billion yuan (around $345 million) during the first half of 2016, which was a significant rise of 384% year-over-year (YOY). Sales revenues increased 1.6 times to 15 billion yuan leading to a midyear turnover of 43.7 billion yuan which was a 44% increase YOY.

What’s Aiding BYD's Profits?

The company has benefited from favorable policies by the Chinese government intended to drive up the green car sales in the country. BYD now holds the No. 1 rank as the manufacturer of battery-electric automobiles in China. (See also: Chinese Competition in EV Market on the Rise.)

While competitors focused on electric cars, BYD was one of the first companies to offer large-sized electrical buses, making an entry into the mass transport vehicle segment. Additionally, it recently launched sanitation trucks with varying load capacities ranging from one to 32 tons. Its fleet of sanitation trucks consists of 26 different models, and was launched jointly with the Beijing Environmental Sanitation Engineering Group. The fleet is equipped to perform functions of collecting, disposing of and transporting garbage, along with street sweeping and refrigerated transportation of harmful waste. The initiatives indicate BYD’s potential to customize and pitch their offerings for various needs.

BYD’s innovations in manufacturing powerful batteries with large storage are also giving it a head start. For instance, its 350-kilowatt-hour iron-phosphate battery takes only 3.5 hours to fully charge, and offers 250 miles of driving over seven hours  for its large sized trucks.

Recent Developments

Since the third quarter of last year, BYD has been consistently reporting triple-digit growth. The company also declared a dividend of 0.367 yuan per share. The company also got a boost when the South Korean electronics conglomerate, Samsung Electronics Co. Ltd., purchased 52.3 million BYD shares at price of 3 billion yuan in July this year. Samsung’s entry has reduced Berkshire’s stake to 8.25%.

The shares, dually listed on the Hong Kong and Shenzhen market, have appreciated by more than 50% in the past one year.

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