(Bloomberg) -- Chinese electric-vehicle stocks rallied in Hong Kong after state media reported on government measures to support the sector’s development.
Central-government agencies will increase purchases of new-energy vehicles, state media Xinhua News Agency reported Tuesday, citing a government guideline dated Sept. 27 that said EVs should be no less than 30% of new vehicles purchased annually in principle.
It also stated that the purchase price per vehicle should not be above 180,000 yuan ($25,200), and recommended measures like construction of charging infrastructure to make EV usage easier.
NIO Inc jumped as much as 13% in Hong Kong and was the top performer on the MSCI China Index. Xpeng Inc. rose as much as 8%, and Zhejiang Leapmotor Technology Co Ltd gained more than 6%. Sector leader BYD Co. advanced up to 1.8% ahead of its third-quarter earnings release Wednesday.
“Some places already had similar policies, but it should be a good thing, overall boosting up the mid-end brands like BYD and Leapmotor,” said Kelvin Lau, an analyst at Daiwa Capital Markets Hong Kong Ltd.
The guideline also recommended buying EVs for sanitary cleaning and technical inspection purposes.
“While the incremental volume to the passenger cars might be limited in our view given the large base effect, commercial new energy vehicles and specialty cars could likely see larger growth,” said Vincent Sun, an analyst at Morningstar Inc.
(Updates with details and analyst voice in the last two paragraphs.)
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