On April 7, the hot real estate sector ushered in an adjustment, with an overall decline of more than 4%, 13 shares falling by the limit and 50 shares falling by more than 5%. After hours data showed that a total of 3.7 billion funds flowed out on that day.
The reporter of China fund daily noted that with the continuous rise of real estate stocks after the meeting of the Financial Committee on March 16, important shareholders dominated by industrial capital have been intensively reducing their holdings. In nearly half a month, 15 real estate stocks announced that they had been reduced or received reduction plans, including 8 in nearly a week, including Huay Uan Property Co.Ltd(600743) , Citychamp Dartong Co.Ltd(600067) , Yang Guang Co.Ltd(000608) , Yango Group Co.Ltd(000671) , etc. On the whole, the recent reduction of holdings is mainly small and medium-sized real estate enterprises and out of danger real estate enterprises.
According to the analysis of securities companies, with the continuous release of policies and the improvement of stability maintenance expectations, the industry policy atmosphere during this period is relatively friendly, and there will be a big game in the market for the reduction of default risk of private enterprises, but in the long run, real estate enterprises with high credit are a more stable strategy.
several real estate companies announced reduction
On the evening of April 7, two more real estate companies announced the reduction of their holdings.
Huay Uan Property Co.Ltd(600743) announced that due to its business development and capital needs, the shareholder Jingtai investment plans to reduce its shares of the company by centralized bidding within 6 months after 15 trading days from the date of disclosure of the announcement, i.e. no more than 0.46% of the total share capital, and the reduction price is determined according to the market price.
Before the reduction, Jingtai investment held 128 million shares of the company, accounting for 5.45% of the total share capital of the company. After the reduction, its shareholding will be less than 5%, and it will no longer be an important shareholder, which means that the subsequent reduction will not need to be disclosed.
China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) announcement, on December 14, 2021, disclosed the suggestive announcement on the plan of reducing shares held by bidding for investment by centralized bidding. The plan of reducing shares held by bidding for investment by bidding for investment from January 6, 2022 to July 5, 2022 does not exceed 20.91 million shares. On April 7, 2022, the company received the notification letter on the progress of the investment reduction plan issued by Zhaowei investment. Zhaowei investment reduced 8.87 million shares, with an average reduction price of about 15.25 yuan.
Zhaowei investment is a limited partnership. After penetration, the final actual controller is China Merchants Securities Co.Ltd(600999) , and this batch of shares are obtained through private placement. Judging from the average reduction price of 15.25 yuan, the reduction of shares for investment should have occurred in recent trading days, because China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) rarely touched the above reduction price before the end of March.
On the evening of April 6, Citychamp Dartong Co.Ltd(600067) announced that due to its own capital needs, the shareholder starlexlimited plans to reduce its total shares of the company by no more than 29 million shares, that is, no more than 1.95% of the total share capital of the company. The announcement shows that starlexlimited holds 30.39 million shares of the company, accounting for 2.04% of the total share capital of the company, which means that the reduction is close to clearing. It is worth mentioning that starlexlimited is actually acting in concert with Fengrong investment, the controlling shareholder of the company, which holds 6 Lead Eastern Investment Co.Ltd(000673) 395% of the shares.
industrial capital dominated, directors, supervisors and senior managers also reduced
According to the incomplete statistics of the reporter of China Fund News, the number of real estate companies that issued the announcement of reducing their holdings in the past week reached 8, compared with 15 since the special meeting of the Financial Committee on March 16. The reduction targets are mainly industrial capital, including the actual controller of the company, and some are financial investors. Except China Merchants Shekou Industrial Zone Holdings Co.Ltd(001979) , most of the reduced real estate enterprises are small and medium-sized real estate enterprises or real estate enterprises that have recently been in danger.
On April 1, Yang Guang Co.Ltd(000608) announced that as of March 31, Shanghai yongpan, a shareholder of more than 5% of the company, had reduced its holdings of 21.26 million shares, accounting for 2.836% of the total share capital of the company, and held less than 5% after the reduction. Most of the reduction occurred in March, with the highest reduction price of 4.15 yuan and the lowest of 2.86 yuan.
The big fund also made a move. On April 1, Shanghai Wanye Enterprises Co.Ltd(600641) announced that the third largest shareholder, the national integrated circuit industry investment fund, held 48.56 million shares of the company’s non tradable shares, accounting for 5.07% of the company’s total share capital. Due to its own operation and management needs, the large fund plans to reduce its holdings by no more than 1% of the total shares of the company, that is, no more than 9.58 million shares, from April 27, 2022 to July 26, 2022.
With the continuous thunderstorm of Yango Group Co.Ltd(000671) , Dong Jiangao joined the reduction team.
Yango Group Co.Ltd(000671) on March 28, He Mei, Lin Yihui and Liao Jianfeng, the directors of the company, received the notification letter on reducing the shares of the company through block trading. The three directors reduced 17.105 million shares in total, accounting for 0.41% of the total share capital of the company. However, the announcement said, “the funds obtained from the reduction are intended to provide interest free loans to the company, including but not limited to the company’s daily production and operation, project delivery, debt repayment, etc.”. The price of this reduction was 3.59 yuan, up nearly 80% in half a month compared with 2.01 yuan at the previous Yango Group Co.Ltd(000671) bottom.
On March 29, Taikang Life Insurance, one of the Yango Group Co.Ltd(000671) two shareholders, issued the notification letter of share reduction. From March 18 to March 28, Taikang Life Insurance reduced a total of 87.9 million shares, accounting for 2.12% of the total share capital of the company. The maximum reduction price reached 4.01 yuan, almost double the bottom price.
securities companies: high credit real estate enterprises are more stable
Industry insiders believe that after the meeting of the financial committee, we need to pay attention to the implementation of policies. One of the most important contents is real estate, which is still not very optimistic, and the industry risks have not been resolved.
At present, the pace of deregulation of the property market in second and third tier cities is accelerating.
As of April 6, six cities have relaxed their property market regulation policies in the past week, namely Fuzhou, Nanning, Lanzhou, Qinhuangdao, Quzhou and Mianyang, half of which are provincial capitals. Since the beginning of the year, according to incomplete statistics, more than 65 cities have issued property market deregulation policies, which mainly involve relaxing purchase restrictions, canceling / relaxing sales restrictions, reducing down payment ratio, reducing housing loan interest rate, provident fund loan preference, house purchase subsidy, financial support of real estate enterprises, etc. Among them, there are many provincial capitals such as Zhengzhou, Fuzhou, Harbin and Lanzhou that relax purchase and sale restrictions.
The Pacific Securities Co.Ltd(601099) securities analyst Xu Chao believes that in essence, real estate enterprises need to pay off their debts mainly from three sources of funds: refinancing, asset disposal and sales collection. When it is difficult for most private real estate enterprises to resume refinancing, it is worth observing whether there can be improvement in asset disposal and sales collection. In terms of asset disposal, it is worth observing whether state-owned enterprises and AMC can have greater motivation to cooperate to acquire projects of troubled real estate enterprises, especially whether state-owned enterprises can be released to issue shares to buy assets.
In terms of sales, it believes that the effect of policy relaxation remains to be seen. If the real estate dragged down the economy in the fourth quarter of last year, the unstable expectation of residents’ income in the first quarter of this year may drag down the real estate to a certain extent. “We expect that the sales data in the first half of the year may be difficult to improve. In the second half of the year, as the base becomes lower, the year-on-year data of the first and second tier cities may take the lead in improving, but the absolute value cannot be too optimistic.”
Dongxing Securities Corporation Limited(601198) analyst Chen Gang said that in the short term, with the release of policies and the improvement of stability maintenance expectations, the industry policy atmosphere is relatively friendly during this period, and there will be a big game in the market for the reduction of default risk of private enterprises. But in the long run, holding high credit real estate enterprises is a more stable strategy. “The advantage of financing will promote high credit real estate enterprises to gain advantages in the land and M & a market. The continuous land acquisition and promotion ability and high-quality credit endorsement are also expected to seize the opportunity when the demand recovers. It is recommended that China Vanke Co.Ltd(000002) , Poly Developments And Holdings Group Co.Ltd(600048) , Gemdale Corporation(600383) .”
