Economic Observer Network reporter Chen YueqinAffected by the rumors of “Shimao and Lujiazui Trust’s postponement”, the bond and stock prices of Shimao Group have fallen sharply in the past two days. At 4:30 pm on November 5th, Shimao Group urgently held an investor conference call. Shimao Group’s Board of Directors and President Xu Shitan, as well as relevant persons in charge of investor relations, introduced the company’s bonds and assets, and answered investors’ questions.
Two hours later, Shimao issued an announcement stating that it would repurchase 500,000 shares at a price of 9.68 Hong Kong dollars per share and pay a total of 4.84 million Hong Kong dollars.
Sales fell by 30% in October
At the conference call, the relevant person in charge of Shimao introduced the recent sales situation. In October, the sales amount exceeded 20 billion yuan, and the return was close to 20 billion yuan, a year-on-year decrease of 30%. It’s faster”.
According to the person in charge, sales and payment collection are relatively better because of price cuts, and the mortgage policy has been relaxed in October. The monthly mortgage payment is 6-7 billion yuan, and it can reach 7-8 billion yuan in October.
At the 2020 annual results conference held on March 30 this year, Shimao’s management stated: “In 2021, the group’s saleable value is 550 billion yuan. Based on the 60% sale rate, the annual sales target of 330 billion yuan can be achieved. , The year-on-year growth rate has reached more than 10%.” In the first nine months of 2021, the annual sales target was about 67%.
The relevant person in charge of Shimao said that according to the annual sales target of 330 billion yuan, the monthly performance target is about 30 billion yuan. “In the past few months, only about 20 billion yuan, and it is expected to complete 290 billion yuan this year.”
The person in charge revealed that Shimao has been promoting sales from July to September. Compared with peers’ price cuts of 30% to 40%, Shimao’s gross profit is higher and there is still room for price cuts. “If it weren’t for the (promotional) policy, it would cost 20 billion per month. Yuan sales may not be reached.”
Shimao said that it will reduce land acquisitions and concentrate funds to guarantee bond repayment. If the subsequent financing situation improves, it will consider acquiring land.
He said that financial institutions and local governments have strengthened the supervision of pre-sale funds, but some places have overcorrected. “Some (projects) can obviously be delivered for 100 million yuan, but 300 million yuan (in the regulatory account) must be pressured, otherwise we can use Funds should be more”.
Repurchase of U.S. dollar debt
Shimao’s management noticed the recent significant drop in stock and bond prices, and responded that Lujiazui Trust’s default and extension were false news. He revealed that the trust volume is about 3 billion yuan, all due in 2022-2023. .
Affected by this news, Shimao’s bond prices fell sharply in the past two trading days. The person in charge explained: “In the past few days, some investors who only bought one lot, listed 20-30 yuan to hit the market.” Relevant agencies recommend canceling retail purchases, but they are worried that it will be interpreted as preventing retail purchases.
The telephone conference revealed that Shimao will launch the repurchase of US dollar bonds, domestic bonds and stocks in the near future, hoping to give confidence to the market.
The wealth management products guaranteed by Evergrande and Kaisa have defaulted one after another, causing investors to worry. The aforementioned person in charge stated that some of Shimao’s regional companies are carrying out similar businesses, and the number is small, “the scale is not tens of billions.”
Shimao has US$1 billion of offshore bonds that will mature in July next year, and another US$700 million “1+1+1” bond that will mature in April and May 2022. It is currently discussing extensions with investors.
Regarding the current amount of Shimao’s overseas funds, the person in charge said that it is not convenient to release the figures. According to the semi-annual report, “As of the end of June, there are more than 80 billion in cash. The Hong Kong Stock Exchange requires that no more be disclosed.”
Plan to sell assets
At the conference call, the person in charge of Shimao stated that Shimao’s sales target in 2022 is expected to be within 300 billion yuan, but if the policy is relaxed in the future, it may exceed 300 billion yuan.
Shimao’s management stated that there should be no major problems in real estate. The annual real estate sales are still at the level of 17-18 trillion yuan, and it is unlikely that there will be too much adjustment. Mortgage and development loans have been loosened to a certain extent, indicating that the policy is at the bottom. “At present, the supervision card is quite strict, and the transmission of policies and liquidity will take some time to ease.”
Shimao’s management believes that the current favorable policies are not strong enough. “At the moment, the government needs to give confidence first, and then market confidence will gradually improve. These two months are more critical. I believe that better policies will come out early next year.”
The relevant person in charge of Shimao said that Shimao’s office buildings and hotels in Shanghai, Beijing and Hong Kong are worth more than 20 billion yuan for sale. “If it can be sold, it should be able to return more than 200 billion. The main plan is to sell the inventory. The price is still being discussed, and the 40% discount will definitely not be sold, and the 85-90% discount will be considered if the payment terms are good.”Return to Sohu to see more
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