After designer Country Garden apparently obtained an extension to a crucial debt payment deadline, shares in Chinese real estate firms have increased.
On Monday, stock of well-known home builders like Country Garden and Evergrande increased in Hong Kong.
Buyers also praised Beijing’s decision to intensify its support for the sluggish market.
It represents some exceptional, positive reports for China’s real estate sector, which has been hit by the financial problems.
Shares of Country Garden, which are listed in Hong Kong, were about 15 % higher on Monday afternoon.
Since the beginning of this year, the company’s shares have also fallen by more than 60 %.
One of China’s largest real estate developers, Country Garden, was required to pay off an onshore private bond worth 3.9 billion yuan($ 430 million,$ 540 million ) on Saturday.
According to reports, the company avoided defaulting on the bill after Chinese lenders agreed over the weekend to let it make the payments in installments over a period of three times.
According to Bloomberg, the company has also wired a payment on an interest-bearing bond worth 2.85 million Malaysian ringgit(£ 490, 000,$ 613,000 ).
On two US dollar bonds it missed in August, it is still expected to make debt payments of$ 22 million($ 17.4 million ) by Wednesday.
A BBC request for comment was not instantly answered by Country Garden.
The agency’s difficulties have come to light in recent months.
The company reported a record$ 6.7 billion($ 5.2 billion ) loss for the first six months of the year last week.
It was” deeply remorseful for the unsatisfactory performance ,” Country Garden said in a statement at the time.
Big businesses opened the door for additional rate reductions in banking on Friday as Beijing increased economic stimulus measures.
Concerns about China’s real estate market, which makes up about 25 % of the second-largest economy in the world, grew at the time.
As the business struggles to recover from the pandemic, problems with home contractors and business producing the goods that go in them are having a significant impact.
When new regulations were implemented in 2020 to limit the amount of money that large real estate firms could use, the actual real property market in China was rocked.
Evergrande, which was once China’s top-selling developer, amassed debts totaling more than$ 300 billion as it aggressively grew to become one of the largest corporations in the nation.
Due to a number of designers defaulting on their debts and abandoning empty construction projects across the nation, the country’s real estate sector has been affected by its economic issues.
Evergrande reported a reduction of 33 billion yuan for the first six weeks of the year just over one year earlier.
In the first day of trading in Hong Kong in nearly 80 % of the company’s stock, which have been traded there for a full year, last Monday.
As Beijing tightened its restrictions on real estate firms over the past three decades, Evergrande stocks have lost more than 99 % of their worth.
China is also dealing with a number of problems, such as slow economic growth, rising regional government debt, and record-high children employment.
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