BYD Company, the electric vehicle (EV) and battery manufacturer, saw its stock plunge 7.54% intraday on Tuesday, underperforming the broader market. This significant decline followed the company's announcement of a placing of new H shares under a general mandate.

The placing aims to raise approximately HK$43.5 billion (around $5.6 billion) in gross proceeds, with the net proceeds expected to be around HK$43.4 billion. BYD plans to use the funds for research and development investments, expanding its overseas businesses, and other undisclosed purposes.

While raising capital could potentially support BYD's growth initiatives, the stock dilution from issuing new shares appears to have weighed heavily on investor sentiment. The increase in the total number of outstanding shares typically exerts downward pressure on the share price, at least in the short term.