Warren Buffett scores again, this time with a $1 billion paper profit on Chinese automaker BYD Co. that makes hybrid cars.
Since Buffett's initial investment in the firm last September, Hong Kong trading has boosted the stock some 500 percent.
The whopping increase was attributed to Buffett's cash infusion and the growing appetite for fuel-efficiency in motor vehicles, reported Bloomberg News.
Buffett racked up another $2 billion in paper profits since his year-ago investment in Goldman Sachs.
"When Warren Buffett says the sun shines on somebody's backside, it's worth paying attention," Guy Spier, a principal at Aquamarine Funds LLC, told Bloomberg.
Aquamarine Funds is a New York hedge fund which owns shares in Berkshire Hathaway Inc. He’s researched BYD extensively.
Buffett apparently liked the BYD management team, said Spier and is “betting on the jockey in this case," referring to BYD CEO Wang Chuanfu.
BYD launched its F3 DM model auto, reportedly the world's first mass-produced plug-in hybrid, late last year.
"Investors are buoyed by the potential growth in BYD's electric car business," Hong Kong securities analyst Barry Leung told Bloomberg.
"The alternative energy sector is clearly one that will continue to enjoy the support of the Chinese government," he said.
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