If there’s anything about BYD’s past that predicts its future, it’s that it’s slow and steady. The nearly 30-year-old company may surpass Tesla in total car production by 2023, but its market value is still only one-tenth. Tesla stock’s price has nearly doubled in the last year. BYD rose about 10%. Bernstein first started covering BYD in September, with an outperform rating and price target of HK$359. As of Thursday’s close, the gain was 71%, far higher than the 42% recorded at the start of the report. Are there problems such as oversupply that the market is overlooking? The news that Berkshire Hathaway, led by famous early investor Warren Buffett, continues to reduce its stake for unspecified reasons does not improve foreign investor sentiment. Taylor Ogan, CEO of Snow Bull Capital, said one factor behind the low valuation was Norway’s electrification, which would “probably have a bigger impact on stock prices” than vehicle electrification in Brazil. He said that BYD does not have a monopoly on such a glamorous market. Another issue is the lack of financial research analysts specifically covering both Tesla and China, he said. BYD is traded on the Hong Kong and Shenzhen exchanges in mainland China. The company sells passenger cars primarily in China, with some expansion into regions such as Southeast Asia and Europe, but not North America. By contrast, Nasdaq-listed Tesla’s main market is the U.S., with China accounting for about 20% of its sales. Energy company? Elon Musk’s automaker also had a hard time convincing Wall Street to buy it in recent years. “I’ve been a long-time follower and investor in Tesla,” Organ said. “For years, it was very frustrating. The general excuse was that Wall Street didn’t understand Tesla.” Moved to Shenzhen and opened a research office. BYD started with batteries and has a huge campus on the outskirts of Shenzhen. The company reduces costs by developing expensive car batteries in-house, and offers a variety of car models at various price points. “I think we’re going to tip BYD the same way we tipped Tesla when people start to realize that BYD is an energy company,” Organ said. “I think there will come a day when they realize, wow, BYD makes its own solar cells, its own inverters, its own batteries,” he said, adding that the company is “essentially building electric buses that move batteries around. “We are manufacturing,” he added. ” He predicts the market won’t realize BYD’s capabilities until 2025. Several analysts have already rated the stock a “buy,” but their 12-month price targets still won’t put BYD close to Tesla in terms of market value. CLSA’s Xiao Feng said in a report on January 2 that BYD’s high-end models are selling better than expected, which could help boost profit margins. This is despite the company’s channel checks showing that recent price cuts helped BYD increase orders in December. “Overall, our expectations remain at 4 million vehicle sales in 2024, and we expect overly bearish profitability forecasts to be revised upward by consensus,” the report said. The target price is HK$310, and BYD’s rating is “buy.” “Our understanding is that auto parts analyst Joel Yin likes BYD and has set a higher price target of HK$382, but the stock is underperforming Chinese smartphones and Xiaomi electric vehicles. It also pointed out that there is the potential to profit as a battery supplier to the business.” Companies currently involved in Xiaomi’s EV supply chain include CATL (300750 CH)/BYD (1211 HK, for batteries); Includes Inovance (300124 CH, for electric motors), Ningbo Tuopu (601689 CH, for chassis and air suspension, etc.). Hesai Tech (HSAI US),” Ying said in a Jan. 3 report. Xiaomi’s SU7, like the Zeekr 007, is likely to be sold for 200,000 to 300,000 yuan ($28,160 to $42,240), he said. That’s also BYD’s price range. Tesla’s Model Y sells at a slightly higher price point, but it’s a Han sedan. —CNBC’s Michael Bloom contributed to this report.