Most real estate businesses have stable operations. saying “Until now, the Evergrande incident can still be considered an isolated case of a single company’s mismanagement. The dollar bond investors will follow these (as there are multiple payments lining up).Įven with authorities’ intervention in the past weeks, Tan does not believe that the Chinese government will bail out Evergrande and its founder Xu Jiayin. After homebuyers, retail investors, suppliers and contractors to Evergrande, local banks and bondholders would probably be next on line, possibly with haircuts. These steps are intended to safeguard the interests of millions of homebuyers, suppliers and the staff of the indebted companies,” said Cheng Wee Tan, senior equity analyst at Morningstarįrom the bond perspective, Rohini Malkani, senior vice president for global sovereign ratings at DBRS Morningstar, also expects a similar priority line-up. The People’s Bank of China’s recent meeting in mid-October reflects the regulator’s determination to contain property risks by ensuring liquidity access to developers and projects. “The first signs of easing policies are emerging after weak property sector sales numbers were released. Our equity analysts observe that investor sentiment towards the capital markets – outside of the Evergrande and related parties – has slowly been recovering. China Evergrande Group closed at HK$ 2.58 and saw another single day drop of 12.5%. Trading in shares of China Evergrande Group, Evergrande Property Services Group, and Hopson resumed on October 21. Meanwhile, negative headlines about the cash-strapped firm pile up, even as it has not made any public comments on the situation. Hopson intended to acquire about 51% shares in Evergrande Property Services (06666). The group has failed to sell off some of its assets to Hopson Development (00754), a smaller-scale competitor. There have been more twists and turns in this week.
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