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    3333   KYG2119W1069

CHINA EVERGRANDE GROUP

(3333)
  Report
End-of-day quote. End-of-day quote Hong Kong Stock Exchange - 12/06
1.81 HKD   -19.56%
01:17aChinese Property Stocks Rally as Beijing Signals Support for Sector
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01:05aFactbox-China Evergrande's bond coupon payments through May 2022
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01:04aChina Evergrande's snowballing debt crisis
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SummaryMost relevantAll NewsAnalyst Reco.Other languagesPress ReleasesOfficial PublicationsSector newsMarketScreener Strategies

China Evergrande : Chinese property firms weigh cutting home prices after Evergrande's deep discounts

09/10/2020 | 02:02am EST

HONG KONG, Sept 10 (Reuters) - Country Garden, China's top property developer, and smaller real estate firms are weighing offering bigger discounts on home buys after rival Evergrande unveiled its steepest ever discount this week, analysts and a source said.

Evergrande, China's second biggest property developer, announced a nationwide 30% discount on all of its properties until the end of the week-long holidays in early October, a period that is traditionally China's peak home buying season.

The move is aimed at juicing sales and cash flow at China's most indebted developer at a time when its profits have weakened.

Steeper discounts from developers come against the backdrop of a sluggish recovery in home prices in smaller cities and ebbing appetite for property market speculation outside major cities due to uncertain economic conditions.

A Country Garden source said the company is planning to launch a campaign in response to Evergrande's price cut, but the rate of discount may be lower.

The person, who asked not to be named because the plans are yet to be finalised, added it is not unusual for the company to introduce promotions in September and October.

Country Garden did not immediately respond to a request for comment.

The developer and Evergrande have similar project footprints in the country, focusing on tier-3 and 4 cities and peripheral locations in bigger cities.

Other major developers told Reuters they won't offer across-the-board or steep discounts to compete with Evergrande because their projects are in very different locations and the bigger cities are selling well.

According to data of 18 major cities real estate researcher CREIS tracks, home transactions in August rose 3.4% from July, and 26.7% from a year ago.

"Developers will face pressure; they're watching closely, but it'll be mostly those who have projects next to Evergrande's only," said Andy Lee, realtor Centaline's South China CEO.

"Because a 30% discount basically wipes out all the profits; it's mostly for driving sales volume."

HIGH DEBT LOAD

Previous discounts have come at a cost to Evergrande's margins. Last week, it posted a 37% slump in first-half core profit despite a 24% increase in sales.

Its total borrowings climbed 2.7% during the period to 835.5 billion yuan ($122.03 billion). The company has targeted sales of 800 billion yuan in 2020.

Matthew Chow, a director at rating agency S&P Global, said Evergrande's deep discount offer is likely to be "company specific" because it has short-term debt obligations coming due.

"Evergrande relies a lot on its cash generation to tackle all the upcoming obligations; sales is obviously one of Evergrande's key cash inflow," Chow said. ($1 = 6.8468 Chinese yuan renminbi) (Reporting by Clare Jim; Editing by Muralikumar Anantharaman)


ę Reuters 2020
Stocks mentioned in the article
ChangeLast1st jan.
CHINA EVERGRANDE GROUP -19.56% 1.81 End-of-day quote.-87.85%
COUNTRY GARDEN HOLDINGS COMPANY LIMITED 1.84% 7.19 End-of-day quote.-32.93%
All news about CHINA EVERGRANDE GROUP
01:17aChinese Property Stocks Rally as Beijing Signals Support for Sector
DJ
01:05aFactbox-China Evergrande's bond coupon payments through May 2022
RE
01:04aChina Evergrande's snowballing debt crisis
RE
01:02aAsia stocks bounce from one-year low, China gains on monetary easing
RE
12:43aSome Evergrande bondholders not received overdue coupon payments -sources
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12:08aChina stocks rise as investors cheer monetary easing
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12/06Analysis-China Evergrande teeters again, but investors less fearful
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12/06China stocks rise as investors cheer monetary easing
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12/06Evergrande to Include All Foreign Debts in Restructuring
MT
12/06Some Evergrande bondholders not received overdue coupon payments -sources
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More news
Analyst Recommendations on CHINA EVERGRANDE GROUP
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Financials
Sales 2021 530 B 67 884 M 67 884 M
Net income 2021 9 514 M 1 220 M 1 220 M
Net Debt 2021 453 B 58 123 M 58 123 M
P/E ratio 2021 2,51x
Yield 2021 2,10%
Capitalization 23 900 M 3 064 M 3 064 M
EV / Sales 2021 0,90x
EV / Sales 2022 0,61x
Nbr of Employees 163 119
Free-Float 27,4%
Chart CHINA EVERGRANDE GROUP
Duration : Period :
China Evergrande Group Technical Analysis Chart | 3333 | KYG2119W1069 | MarketScreener
Technical analysis trends CHINA EVERGRANDE GROUP
Short TermMid-TermLong Term
TrendsBearishBearishBearish
Income Statement Evolution
Consensus
Sell
Buy
Mean consensus HOLD
Number of Analysts 9
Last Close Price 1,81 HKD
Average target price 6,34 HKD
Spread / Average Target 250%
EPS Revisions
Managers and Directors
Hai Jun Xia Vice Chairman & Chief Executive Officer
Shou Ming Shi President
Da Rong Pan Chief Financial Officer & Executive Director
Ka Yan Hui Chairman
Dong Feng Chen Head-Information
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