Jia Sheng Stock Rises 67% After Billionaire Li Ka-shing Jumps On Board

On January 25th, Jia Sheng Holdings Ltd. (HKG:0729) saw its stock spike 67% after announcing it had agreed to sell a 2.5% stake to billionaire Li Ka-shing and also plans to purchase Union Grace Holdings, an electric car battery manufacturer.

The 67% spike, to HK$1.50, was the largest intraday gain for Jia Sheng since 2003.  Currently, Jia Sheng sits at HK$1.23, up from HK$0.90 on January 15, 2010.

Li Ka-shing will invest HK$292 million (US$38 million) in Jia Sheng.  The company will use some of the Li's money to build battery manufacturing plants after it agreed to buy Union Grace Holdings.  Jia Sheng acquired Union Grace for HK$2.8 billion, and will now try to use its new lithium and yttrium-based battery technologies to become a major player in the burgeoning electric vehicle market.

Electric cars are quickly becoming hot investment, especially in China.  Last year, Warren Buffett purchased a 9.9% stake, HK$1.8 billion, in BYD Company Limited. (HKG:1211)--the largest automaker outside of state control in China.

Vivan Chan, an analyst with SinoPac Securities Asia Ltd. explained just how significant Li Ka-shing's influence on buisness and the stock market is:  "Even market rumors about Li investing in a company can push shares through the roof, never mind an official announcement.  His influence is much like Buffett's in the U.S."

Read the full story at BusinessWeek:  Jia Sheng Soars as Li Follows Buffett With Battery Investment