More trouble for Chinese real estate: Country Garden sales nosedive and shares suspended on the stock exchange
Real estate
Posted by MoneyController on 03.04.2024
- 2085
- 0 Follow me
The crisis in the Chinese property market continues: after the Evergrande crisis, the next group to find itself in a very difficult situation is Country Garden Holdings.
Country Garden Holdings, a major Chinese property company, reported an 83 per cent drop in sales in March compared to the same month last year. As reported in Nikkei Asia, similar figures had been reported in January and February this year, confirming an increasingly serious downward trend. In the meantime, the company has been unable to report its annual figures, unlike its monthly figures, and its shares have been suspended from trading on the Hong Kong stock exchange.
Country Garden Holdings also defaulted on a 96 million yuan (about USD 13 million) bond that was due in mid-March. After 30 days from the due date, Country Garden Holdings risks being listed as insolvent. The company had already defaulted (as defined by international financial institutions, according to Nikkei Asia) on a payment in October, when the property company failed to pay the coupon on a bond.
The property company will also have to appear before the Hong Kong High Court, which has been asked by an offshore creditor to take Country Garden Holdings to court over the non-payment of a loan - plus interest - of around 204 million dollars (the first hearing, according to Nikkei Asia, is scheduled for 17 May).
This event is part of a more general period of difficulty for the Chinese and Hong Kong financial markets. As Shreyashi Sanyal writes on 'CNBC', citing HSBC data, the outflows from the Chinese and Hong Kong stock markets since 2021 amount to USD 4.8 trillion, which is more than the value of the entire Indian stock market.
Read also:
China: will the government's moves be enough to reassure markets?
