China Evergrande Group, which is one of the largest real estate companies in China, is coming to enter the stock market again after 17 months. From Monday, the shares of the company will again be seen trading in the Chinese markets. About a year and a half ago, when the company was sinking and the shares started falling, the market had stopped trading. The company's shares will be seen trading again on Monday. This thing has come to the fore when the world's most debt-ridden real estate developer has incurred a loss of $ 4.5 billion in the first six months of the year.
$4.5 billion tax loss in 6 months
According to Bloomberg's report, the shareholders of the company, which is currently engaged in the restructuring of its loan, suffered a loss of 33 billion yuan ($ 4.5 billion) between January 1 and June 30. This information was placed in a submission to the Hong Kong Stock Exchange on Sunday. The special thing is that in the last two years, the company has suffered a loss of more than 582 billion yuan. It is clear that this company, which was listed in the year 2009, has come under the grip of recession.
Trading done on March 18, 2022
The company has submitted a request to resume trading in Hong Kong from 9 am on Monday. The move comes after the company's recent statement that its enhanced internal control system and Hong Kong listing fulfill its responsibilities as per regulations. The company's shares were last traded on March 18, 2022 and since then, its market cap has come down 95 per cent from its highest point in 2017.
China economy hilly
With the release of the first half financial results, meetings with creditors have also started, which were scheduled to begin on Monday. The results highlight the challenges Evergrande faces amid the ongoing housing turmoil that has rocked the world's second largest economy over the past two years. As China takes measures to reduce risk and increase housing affordability by curbing the growing real estate sector, many developers have been negatively affected. Evergrande's competitor, Country Garden Holdings Co, is on the brink of default and is expected to report similar losses in the first six months of the year.
Liabilities of 2.39 trillion yuan
Evergrande's net loss for the period totaled 39.3 billion yuan, according to the filing on Sunday. The company also disclosed its combined liabilities, which reached 2.39 trillion yuan by the end of June. Excluding contact-based creditors of 604 billion yuan, total liabilities in the first half totaled 1.78 trillion yuan, showing an increase from 1.72 trillion yuan in the previous year of 2022. The company said in its statement that as of the end of June, Evergrande had total assets of 1.74 trillion yuan, including cash and restricted cash of 13.4 billion yuan.
It took over the role of auditor of the company
During April, the company said the proposal received investor support from 77 percent of its Class A bond holders, while only 30 percent of Class C bond holders supported the plan. A smaller accounting firm called Prism, which took over as Evergrande's auditor in January following PricewaterhouseCoopers' resignation, looked into the financial results. However, Prism refrained from giving a definite valuation on the interim earnings report citing various uncertainties.
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