Growth Dragons Weekly: EV and Bank Stocks Rally During Iran War; J&T Profits Double, Unitree Revenue Triples
What happened in China this week:
China EV Stocks Rally On High Oil Prices; BYD Up 9% While Geely Soars 57%
China Major Bank Stocks Gained More Than 8% During Iran War
J&T Delivers: Revenue Up 18.5%, Profits Nearly Doubled
Unitree IPO Reveals 335% Revenue Growth and Already Profitable
#1 China EV Stocks Rally On High Oil Prices; BYD Up 9% While Geely Soars 57%
Everyone talks about oil majors winning when crude surges. Fewer people think about the other winners—the ones selling the alternative.
China EV stocks have quietly gained more than 5% over the past month, measured by the Global X China EV & Battery ETF (2845). The logic is simple: when petrol gets expensive enough, people start doing the maths on switching.
And the thresholds are well-documented. Every $10 increase in crude translates to roughly $0.25–$0.30 per gallon at the pump. Once US gas hits $4.00 per gallon, surveys by groups like BloombergNEF and AAA consistently show a majority of drivers reconsidering their next car purchase. In Europe, the equivalent trigger is around €2.00 per litre. Cross those lines, and EV search interest and sales historically spike double digits.
BYD stock rose 9%, but the FY25 results weren’t exactly inspiring. Revenue grew just 3.5%, while profits declined 19%. That’s its first annual contraction in four years—and significantly worse than market expectations. Revenue growth of 3.5% was also the slowest pace in six years.
At the core of BYD’s challenges lies intensifying domestic competition. Historically, the company’s dominance was built on its affordable Dynasty and Ocean series, which captured mass-market consumers in China’s rapidly expanding EV segment.
But that advantage has eroded. Rivals like Geely have narrowed the technological gap while competing aggressively on price and features. The result is a more fragmented landscape—described by BYD chairman Wang Chuanfu himself as a “brutal knockout stage.” BYD has fallen from China’s top automaker in 2025 to fourth place in early 2026, alongside its steepest sales drop since the pandemic.
Policy shifts haven’t helped either. The expiration of purchase tax exemptions for new energy vehicles, combined with revised subsidies favouring higher-priced models, has disproportionately hit BYD—over 60% of its domestic sales fall below 150,000 yuan. This misalignment between policy incentives and product mix has constrained demand, while ongoing price wars have compressed margins. Gross profit margins in the core automotive segment declined to 20.5%.
But the market is forward-looking. Investors are pricing in an acceleration of EV sales driven by high oil prices—and that explains why BYD’s stock rallied despite the discouraging numbers.
Geely’s 57% gain was the more impressive story. In previous weeks, we mentioned that Geely managed to dethrone BYD in Q1 2026 to become China’s best-selling carmaker. Its exports soared 129% in the same quarter. Geely is successfully diversifying its revenue streams away from China’s hyper-competitive domestic market.
That said, BYD’s exports grew too—albeit at a slower 56%.
While we covered Geely as an underrated auto stock nine months ago, we still believe investors shouldn’t write off BYD. It might just be a game of musical chairs, with a few China auto players taking the crown from time to time.
As for high oil prices spurring demand for EVs—this tailwind should persist for a while, as long as crude stays elevated.
