3.9k Share this
By Clarence Leong

Shares of Sunac China Holdings Ltd. slumped, following a credit downgrade by Moody’s Investors Service, driven by the Chinese property developer’s constrained funding access and worsening liquidity.

Sunac’s shares fell 9.7% in Hong Kong trade on Monday morning, taking year-to-date losses to 16%. The Hang Seng Mainland Properties Index declined 4.8%.

Moody’s Investors Service downgraded Sunac’s corporate family rating to B1 from Ba3 late Friday, which it said reflects the developer’s reduced liquidity buffer due to limited funding access and weaker operating cash flow. It also changed its rating outlook to negative from stable.

“The negative outlook reflects potential further weakening in the company’s operating and financial performance over the next 12-18 months amid a challenging operating environment,” the ratings firm said.

Sunac has $1.2 billion of offshore bonds maturing this year, but the chances that it can refinance the debt by issuing bonds at a reasonable cost over the next six to 12 months are low, Moody’s said. It forecasts Sunac’s contracted sales will fall over the same period, weighed down by weak home-buyer confidence and decreased saleable resources after its project disposals.

Some smaller Chinese developers were sharply lower after releasing their most recent sales data late Friday. China Aoyuan Group Ltd. shed 9.1% after January contracted sales lost more than 80% from a year earlier. Shimao Group Holdings Ltd. skidded 7.5% following a 62% slump in January sales.

Write to Clarence Leong at [email protected]

Source: This post first appeared on http://marketwatch.com/

3.9k Share this
You May Also Like

Global Chip Supply-Demand Imbalance Is Spurring Industry Change: NXP CEO Kurt Sievers

Visitors gather around a NXP trade show pavilion in Europe. Photographer: Simon…

Tips for Building a Thriving Business

Opinions expressed by Entrepreneur contributors are their own. In my last article,…

Despite Bear Market, Fed Expected To Hike Aggressively Next Month

WASHINGTON, DC – JANUARY 29: Federal Reserve Board Chairman Jerome Powell speaks…

Crypto is changing how humanitarian agencies deliver aid and services – Cointelegraph Magazine

The primary use case for cryptocurrency in most wealthy countries is acquiring…

How to Utilize Both for the Benefit of Your Company

Opinions expressed by Entrepreneur contributors are their own. Almost every single aspect…

25 Stocks Former Wall Street Investment Manager Peter Lynch Would Like

. This week, we present the strategy used by the fund manager…

Ethereum, Crash Or Moon? Crypto Crash 2022

Ethereum cryptocurrency getty It’s hard to invest during a crash. You can…

U.S. Will Release Monkeypox Vaccine From National Stockpile, CDC Says

Topline The U.S. is releasing vaccines that can prevent monkeypox from its…