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Tag: China Resources Land Ltd

  • Country Garden shares hit record low after profit warning as debt fears loom

    Country Garden shares hit record low after profit warning as debt fears loom

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    Country Garden Holdings Co.’s Fengming Haishang residential development in Shanghai, China, on Tuesday, July 12, 2022.

    Qilai Shen | Bloomberg | Getty Images

    Shares of beleaguered Chinese real estate company Country Garden Holdings slumped to an all-time low on Friday as the company issued a profit warning a day earlier.

    The stock fell to an intraday low of 90 Hong Kong cents, extending the company’s losing streak after eight sessions of losses in the past nine days. This included a 14.3% plunge on August 8.

    The sell-off in Country Garden shares also spilled over to the wider property sector.

    The broader Hang Seng Mainland Property Index was 1.49% lower in afternoon trade on Thursday. Shares of counterpart Longfor Group were down 1.9%, while China Resources Land saw its shares slide about 1%.

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    In a filing to the Hong Kong exchange, the company said it expects a record a net loss of about 45 billion yuan to 55 billion yuan (or about $6.24 billion to $7.63 billion) for the six months ended June. That’s compared with the 1.91 billion yuan profit for the same period last year.

    Country Garden said it’s “mainly due to the decrease in gross profit margin of the real estate business and the increase in impairment of property projects as a result of the decline in sales in the real estate industry.”

    Expected foreign exchange losses also contributed to the drop in net income, it said.

    Attributable sales from January to July is estimated to come in at 140.8 billion yuan ($19.51 billion) —that’s a year-on-year decrease of 35%, and a 61% drop compared to the same period in 2021.

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    Earlier this week, Country Garden saw a sell-off after reports said the real estate firm had missed two bond coupon payments totaling $22 million over the weekend.

    An investor relations representative for Country Garden did not deny the media reports, but also did not clarify the company’s payment plans, according to Sandra Chow, co-head of Asia Pacific Research for CreditSights, which is a unit of Fitch Group.

    — CNBC’s Evelyn Cheng contributed to this report

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  • Chinese property stocks surge after central bank vows more support for private businesses

    Chinese property stocks surge after central bank vows more support for private businesses

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    A pedestrian crosses a road in front of residential buildings in Beijing, China.

    Qilai Shen | Bloomberg | Getty Images

    Chinese property stocks surged on Friday after the People’s Bank of China vowed to pledge more financial resources to support the private economy.

    Hong Kong-listed shares of real estate developers like Country Garden Holdings, Longfor Group Holdings, and China Resources Land were some of the top gainers on the Hang Seng index. Longfor gained as much as 8.19% and Country Garden Holdings surged 6.2%, before paring some gains.

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    The broader Hang Seng Mainland Properties Index rose as much as 4.76%, but later moderated its gains.

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    The PBOC meeting on Thursday was attended by representatives of eight companies, including Longfor and Country Garden, the central bank said in a statement. Other attendees included diary giant Yili Group, aluminum products manufacturer China Hongqiao Group and electrical components manufacturer Chint Group.

    At the symposium, PBOC governor Pan Gongsheng said the central bank will promote the expansion of private business bond financing support instruments, and strengthen the financial market to support their development.

    This is the latest move by the central government to boost market confidence and vow support for private businesses and the real estate sector amid signs of slowing growth.

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    At the Politburo meeting on July 24, the top leadership promised to “adjust and optimize policies” to boost the beleaguered property sector, as well as introduce measures to promote private investment.

    Separately, China’s state planner, the National Development and Reform Commission, also released a 17-point statement, and pledged to encourage more private capital into the construction of major national projects.

    Days before, the government and the Communist Party issued a rare joint pledge vowing to treat private companies the same as state-owned enterprises, and ensure fair treatment in areas like intellectual property, financing and labor supply.

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    In the latest measures released Thursday, the PBOC said China’s Interbank Market Dealers Association will continue to increase the bond financing support tools to “accelerate the innovation of the bond market,” and “meet the diversified financing needs of private enterprises.”

    Pan urged financial institutions to “actively create a good atmosphere” to support the development and growth of private firms and understand their needs better.

    “It is necessary to accurately implement differentiated housing credit policies, meet the reasonable financing needs of private real estate enterprises, and promote the stable and healthy development of the real estate industry,” the PBOC said, according to a Google translation.

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