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The Chinese real estate developer announced conflicting results. The company cut its losses and returned to the
In the news:
- Between January and June,
Evergrande reported a loss of39 billion yuan ($5.38 billion ). This is still significant, but less than the86.17 billion yuan for the same period last year. -
Revenue was
128.81 billion yuan , compared with89.28 billion yuan inJune 2022 . -
But the group's cash position remains a problem and may lead to further payment problems: from
$2 billion at the beginning of the year to$556 million today. This is very weak for a group of this size. Evergrande's debt remains huge:$328 billion , up from nearly$340 billion at the end of 2022.
The return to the stock market: a painful issue.
- The publication of its 2021 and 2022 results last month enabled
Evergrande to return to theHong Kong Stock Exchange . -
But the stock's value fell 87 percent on Monday from its last trading session on
March 21, 2022 .
The bottom line: can
- In mid-August,
Evergrande launched inthe United States to protect its assets and begin paying off its foreign debts. - At the same time, , another Chinese real estate giant, is at risk of default and has 30 days to repay interest. A rescue plan that should have been voted on Friday has been postponed this week. So the sword of Damocles still hangs over the developer.
-
Since mid-2021, companies accounting for 40 percent of
China's house and apartment sales have been in default. -
According to some experts,
Beijing should deploy the budget bazooka and buy up roughly to clean upChina's real estate sector. -
For now,
China is foregoing a bailout plan. The country already has a very high debt burden and faces a rather slow post-COVID recovery.
(evb/nd)
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