Goldman Sachs maintains BYD's shares traded in Hong Kong on its Conviction Buy list with a price target of HK$405.

Over the past year, while BYD's new energy vehicle (NEV) deliveries have continued to rise, its earnings have not risen at the same rate, raising some questions about its profitability.

BYD's earnings preview, released yesterday, is beginning to dispel those doubts.

BYD earned an average profit of RMB 5,600-7900 ($1,170) per vehicle in the second quarter, CSC Financial said today, citing their calculations. For comparison, that figure was RMB 2,400 in the first quarter.

The surge in NEV sales drove a significant improvement in earnings and somewhat eased earnings pressure from upstream raw material prices, BYD said in its earnings preview yesterday.

Although upstream raw material costs were rising in the first half of the year, the company saw some price increases for its products to cope with the situation, Yicai said in a report earlier today, citing BYD sources.

The source said that upstream raw material costs are stabilizing, and if they come back down in the future, BYD will see more profitability.

BYD's monthly production expected to reach about 300,000 units in August, report says