© Reuters. FILE PHOTO: The corporate logo is seen on the headquarters of China Evergrande Neighborhood in Shenzhen, Guangdong province, China September 26, 2021. REUTERS/Aly Song
By Donny Kwok and Andrew Galbraith
HONG KONG/SHANGHAI (Reuters) – Contemporary Land reported a overlooked payment on Tuesday, doubtlessly the most up-to-date Chinese language property developer to construct so, adding to worries about spiralling effects of the debt disaster at behemoth China Evergrande Neighborhood and dragging on shares in the sector.
China’s advise planner is determined to meet with property corporations carrying properly-kept greenback-denominated money owed later in the day to absorb stock of their total issuance volume and repayment means, amid the mounting concerns about liquidity.
Evergrande, which narrowly averted a costly default closing week, is reeling under greater than $300 million in liabilities and has a major payment closing date on Friday.
Contemporary Land (China) Co Ltd acknowledged in a submitting that it had no longer repaid main and interest on its 12.85% senior notes that matured on Monday attributable to “unexpected liquidity problems”.
This follows a default by Fantasia Holdings Neighborhood on a maturing greenback bond in early October that heightened concerns in worldwide debt markets, already roiled by worries over whether or no longer Evergrande would meet its duties.
Developers are defaulting “one by one”, acknowledged an investor with publicity to Chinese language high-yield debt, who requested no longer to be named as he used to be no longer authorised to be in contact with media.
“The anticipate is continually, who’s next?”
Shares of Chinese language property shares prolonged losses, wound also by concerns over plans to introduce an actual estate tax. China’s CSI 300 Precise Property Index fell 2.6%, and the Mainland Properties Index slumped almost 5%.
The probability of contagion and extra defaults relish weighed on the sector in a major setback for traders.
Chinese language Estates Holdings Ltd acknowledged it would e book a lack of HK$288.37 million in doubtlessly the most up-to-date monetary year from its most up-to-date sale of bonds issued by Chinese language property developer Kaisa Neighborhood Holdings Ltd.
Shares in China Evergrande Neighborhood’s electrical automobile (EV) unit rose as a lot as 5.8% early on Tuesday, because the money-strapped developer acknowledged it would prioritise the progress of its EV change, earlier than reversing direction to hotfoot 3%.
China Evergrande gave up early beneficial properties to topple 6%.
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