On September 2, BYD ELECTRONIC fell 3.21% in regular trading, trading at 26.24 HKD/share, with turnover of approximately 53.61 million HKD. The decline followed a wave of investment bank downgrades triggered by disappointing interim results.

Morgan Stanley published a research note on September 1 slashing its full-year earnings forecast for BYD ELECTRONIC by 68% and lowering its target price from 39 HKD to 33 HKD, while maintaining an Overweight rating. Separately, Jefferies cut its target price from 29 HKD to 25 HKD, keeping a Hold rating. The downgrades came after the company reported H1 revenue of RMB 82.234 billion, up just 2.02% year-over-year, while attributable profit plunged 75.35% to RMB 426 million. Earnings per share fell from RMB 0.77 to RMB 0.19. Gross margin contracted from 6.88% to 4.91%, and operating cash flow dropped sharply to RMB 844 million from RMB 10 billion a year earlier. AI computing infrastructure revenue declined 10.57% year-over-year. Morgan Stanley noted Q2 net profit was still down 64% but expects sequential improvement in the second half as client peak season arrives and liquid-cooling capacity ramps up.

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