Wednesday, January 26

Increase in real estate stocks; Softened Land Sale Rules – Evergrande Update

Chinese real estate stocks posted sudden gains on Friday afternoon in Hong Kong, sending the industry gauge higher in a week amid investor hopes for further policy easing.

A Bloomberg index of real estate companies listed in Hong Kong and mainland China rose as much as 4.7%, partly driven by an 8.3% rise in China Evergrande Group. Country Garden Services Holdings Co., which fell as much as 17% earlier on Friday after its announcement of a $ 1 billion share placement, cut its losses to 8.5%.

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Earlier, several Chinese cities were reported to have relaxed rules for land sales amid waning interest among cash-strapped developers. It was the latest sign of mounting pressure on local governments as the housing market slowdown intensifies.

Key developments:

  • China developer stocks increased; Evergrande up 8.3%
  • Liquidity Stress Continued for China’s Real Estate Developers: Moody’s
  • Evergrande unit resumes work on 63 domestic projects in Guangdong
  • China’s cities ease land bidding rules as ownership stress increases
  • Yango Group Obtains Bondholder Approval for Exchange Offer
  • Evergrande asks Hong Kong agents to sell more apartments for fees owed: SCMP

China Developer Stocks Rise (2:51 pm HK)

A Bloomberg Intelligence gauge of Chinese property developers soared as much as 4.7%, the highest in a week, with China Evergrande Group advancing as much as 8.3%. The index, which measures stocks traded on both the mainland and Hong Kong, was heading for its first gain in three days.

Agile Remits Funds to repay loans in HKD, USD (1:21 pm HK)

Agile Group Holdings Ltd. has remitted funds for the repayment of a HK $ 3.34 billion ($ 429 million) loan and a $ 60 million loan due on November 22, according to a document from the Hong Kong Stock Exchange.

China Developers’ Liquidity Stress Will Continue: Moody’s (1:10 pm)

Limited access to financing by Chinese real estate firms, slowing contracted sales and weakening controls on cash at the project level are reducing cash flow and liquidity, Moody’s Investors Service said in a report.

Everrgrande resumes work at Guangdong Projects (1:00 pm HK)

Evergrande’s main land property development subsidiary said it has resumed construction on 63 housing projects in Guangzhou, Foshan and a few other cities in southern Guangdong province, according to a company statement. The unit reiterated its commitment to delivering quality apartments.

Chinese Cities Facilitate Land Tender Rules (12:50 p.m. HK)

Some Chinese cities have relaxed the rules for selling land after cash-strapped developers became reluctant to bid, threatening the biggest source of revenue for local governments.

Several large cities, including Shanghai and Nanjing, have announced details of land sale plans in December, offering more parcels than in the last round, the official Securities Times reported. Some eased transaction requirements for developers, such as reducing deposits before bidding or refraining from requesting full payment within a month, the newspaper reported.

Country Garden Services Fall After $ 1 Billion Placing (11:18 AM HK)

Country Garden Services plunged as much as 17% in Hong Kong trading, a day after it said it seeks to raise HK $ 8 billion ($ 1.03 billion) through a share sale, the latest real estate firm China to tap into equity markets amid a liquidity crisis. wrapping the sector. Its shares were trading around the HK $ 51 level late in the morning, after the company confirmed the placement price at HK $ 53.35 per share on Thursday.

Zhongliang delivers the bail payment (8:15 a.m. HK)

Zhongliang Holdings Group Co. said it has remitted funds to the trustee for repayment of the outstanding principal amount and accrued interest on a dollar bond due this month, according to a Hong Kong Stock Exchange filing.

Evergrande Asks Hong Kong Agents to Sell More Flats (7:56 a.m. HK)

China Evergrande Group is offering to pay outstanding commissions owed on two apartments for each additional one of similar value that agents sell in one of their Hong Kong projects, the South China Morning Post reported, citing notes from one of a series of meetings between the promoters and real estate agencies.

Evergrande attributed the late payment to its cash flow problems and said the project’s financing structure also “made it impossible to take a large amount of funds to pay commissions.”

Yango nods in debt swap (7:36 a.m. HK)

A unit of Yango Group Co. announced that the bondholders have approved its offer to redeem three of its dollar bonds, according to a filing on the Hong Kong Stock Exchange on Thursday.

The developer will issue $ 669.9 million in new notes due in September to replace the three existing bonds. Yango Justice International Ltd. proposed the debt swap on November 1 after seeing “enormous pressure” on short-term liquidity, saying that if the support was insufficient, the company may “not be able to pay” the notes. existing.

A look at Evergrande’s maturity schedule:

Dollar bonds Coupon expiration date Grace period ends Amount

(A million dollars)

TIANHL 13% due in 2022 November 6th 6th of December 41.93
TIANHL 13.75% due in 2023 November 6th 6th of December 40.56
EVERRE 7.5% due in 2023 December 28th January 27th 50.43
EVERRE 8.75% due in 2025 December 28th January 27th 204.77

© 2021 Bloomberg

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