SME Times is powered by   
Search News
Just in:   • Adani Group to invest Rs 57,575 crore in Odisha  • 'Dollar Distancing' finally happening? Time for India to pitch Rupee as credible alternative: SBI Ecowrap  • 49% Indian startups now from tier 2, 3 cities: Jitendra Singh  • 'India ranks 3rd in global startup ecosystem & number of unicorns'  • LinkedIn lays off entire global events marketing team: Report 
Last updated: 04 Jul, 2022  

Realty.9.Thmb.jpg Big Shanghai developer defaults, deals new blow to ailing Chinese real estate

Hong.Kong.9.jpg
   Top Stories
» 49% Indian startups now from tier 2, 3 cities: Jitendra Singh
» 'India ranks 3rd in global startup ecosystem & number of unicorns'
» Tripura exported over 9K tonnes of pineapples in 2 years
» CPI inflation eases to 6.71% in July, IIP falls to 12.3%
» Rupee depreciates 12 paise to close at 79.64 against US dollar
IANS | 04 Jul, 2022
Another major Chinese developer has defaulted on its debt, dealing a new blow to the ailing real estate sector in the world's second largest economy, media reports said.

Shanghai-based Shimao Group failed to pay the interest and principal on a $1 billion bond due Sunday, according to a company filing to the Hong Kong stock exchange, CNN reported.

The bond had no grace period for the principal, according to its offering document.

It is the first missed debt repayment on a dollar bond by Shimao, which has been grappling with mounting financial stress for months.

China's real estate sector has been lurching from one crisis to another since 2020, when Beijing started cracking down on excessive borrowings by developers in a bid to rein in their high debt and curb runaway housing prices, CNN reported.

The problems escalated significantly last fall when Evergrande -- the second largest property developer in China -- began scrambling to raise cash to repay lenders. The embattled firm is China's most indebted property developer with some $300 billion in liabilities. It was labeled a defaulter by Fitch Ratings in December.

According to Moody's estimates earlier this year, Shimao Group has a large amount of debt maturing in 2022, including $1.7 billion worth of bonds held by international investors, 8.9 billion yuan ($1.4 billion) worth of bonds held by Chinese investors, and "sizable" offshore bank loans, CNN reported.

Founded by entrepreneur Hui Wing Mau in 2001, Shimao develops large-scale residential projects and hotels across the country. It owns Shanghai Shimao International Plaza, one of the tallest skyscrapers located in the heart of Shanghai.

In March, the company estimated that its 2021 net profit had plunged about 62% from a year earlier, mainly because of the "harsh" environment facing the property sector. It then delayed the release of its 2021 results, citing the lockdowns in Shanghai.

"Due to the significant changes to the macro environment of the property sector in China since the second half of 2021 and the impact of Covid-19, the Group has experienced a noticeable decline in its contracted sales in recent months, which is expected to continue in the near term until the property sector in China stabilizes," Shimao said in the filing on Sunday.

Since Evergrande's insolvency, a series of high-profile developers in the country have defaulted on their debts, including Fantasia and Kaisa, CNN reported.
 
Print the Page
Add to Favorite
 
Share this on :
 

Please comment on this story:
 
Subject :
Message:
(Maximum 1500 characters)  Characters left 1500
Your name:
 

 
  Customs Exchange Rates
Currency Import Export
US Dollar
66.20
64.50
UK Pound
87.50
84.65
Euro
78.25
75.65
Japanese Yen 58.85 56.85
As on 13 Aug, 2022
  Daily Poll
COVID-19 has directly affected your business
 Yes
 No
 Can't say
  Commented Stories
» GIC Re's revenue from obligatory cession threatened(1)
 
 
About Us  |   Advertise with Us  
  Useful Links  |   Terms and Conditions  |   Disclaimer  |   Contact Us  
Follow Us : Facebook Twitter