** Hong Kong shares of BYD Co 1211.HK fall 4.2% to HK$389, their lowest since May 12, and on course for fifth consecutive session of decline
** Shenzhen-listed stock 002594.SZ falls 2.7% to 351.3 yuan, lowest since April 30
** UOB Kay Hian cut BYD target price to HK$490 from HK$510 saying China automaker stocks plummeted this week amid price war triggered by BYD, worries over the financial soundness of auto OEMs, and the Ministry of Commerce's probe into "zero-mileage second-hand cars"
** "We deem these concerns valid but the risks remain manageable as long as sales keep growing" - UOB
** A large dealer of BYD's cars in the eastern province of Shandong has gone out of business with at least 20 of its stores found to be deserted or shut, government-owned media reported
** Citi keeps "buy" saying more intense competition would accelerate market consolidation and reinforce BYD's market-leading position
** HSBC maintains "buy" saying the price cuts should boost scale, which absorbs part of the margin pressure, with expanding overseas, high-end mix stabilising the blended profit per car
** YTD, Hong Kong stock up 46.3%, Shenzhen shares up 24.8%
(Reporting by Donny Kwok)
((donny.kwok@thomsonreuters.com))
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