Learn English – Chinese Property Developers are crazy!

Learn English - Chinese Property Developers are crazy

China’s property developers have a habit of countering bad news with good. Bears expect a slowdown, given high net debt and government plans to rein in excessive borrowing. But core profits at big developers grew about 50 per cent on average in the most recent earnings reporting season. The sector cannot defy the bears for ever.

中国房地产开发商常常用好消息来反驳坏消息。鉴于净债务高企和政府计划遏制过度举债,空头人士预计房地产业增长放缓。但在最近的财报季,大型房地产开发企业的核心利润平均增长50%左右。然而房地产业不可能永远反驳空头人士。

The business has already become tougher in two respects. First, the government has restricted land supply in an effort to forestall price drops, so it is harder for developers to increase land banks. Recent mergers in the sector have achieved this at lower cost than auctions.

房地产业已经在两个方面变得更为艰难。首先,中国政府为了防止价格下跌而限制土地供应,因此房地产开发商更难增加土地储备。最近房地产业的合并让开发商以比拍卖更低的成本获得了土地。

Second, regulators are expected to limit residential property sales volumes by restricting consumers’ access to credit. As a result, Moody’s thinks sales growth will slow in the second half this year, after an 18 per cent jump in the first half.

其次,预计监管机构将通过限制消费者获得信贷来限制住宅销售。因此穆迪(Moody’s)认为销售在今年上半年飙升18%之后,将在下半年放缓。

There has been no margin squeeze so far. Sales price growth has outpaced the rate of increase in land costs, with the result that finished property still costs around twice what the land did. That is a ratio as high as it has been since 2013. But it is now likely to decline.

迄今利润还没有受到挤压。销售价格增长超过了土地成本增长,结果导致成品房价格仍然大约是土地价格的两倍。自2013年以来一直都是这么高的比率。但现在该比率可能会下降。

If sales growth does slow, the largest groups will probably gain more market share. The share of the top 10 groups has already quadrupled in the past decade to a fifth. Buying land is a means of gaining scale in a consolidating industry.

如果销售增长确实放缓,最大的房地产企业将可能获得更大的市场份额。前十大房地产企业的市场份额已经在过去十年增长3倍,达到20%。在一个日益整合的行业里,买地是扩大规模的方式。

But it has come at a cost. In a heavily leveraged industry, Evergrande and Sunac stand out with net debt of more than twice shareholder’s equity, even after counting perpetual securities. The sector average is 70 per cent. Both groups have indicated that reducing debt is a priority. In the meantime, they will be helped by lower debt costs — these fell to a record low of 5.4 per cent in the first half. Agreed sales will help with cash flow once they are completed.

但这是有代价的。在一个高度杠杆化的行业里,恒大(Evergrande)和融创(Sunac)逾200%的净负债权益比仍非常显眼,而且这还是计入永续债之后的结果。该行业的平均比率是70%。两家集团均表示,削减债务是重中之重。与此同时,债务成本下降也将对它们有利——今年上半年其债务成本下降至5.4%的创纪录低点。约定的销售一旦完成,还会为它们带来现金流。

Growth in the value of newly acquired land has outpaced the growth in acreage. If that is because of savvier deals, fine. If it is because groups have loaded up on debt to buy speculative land in less mainstream locations, shareholders should be worried.

新获得的土地的价值增长超过了土地面积的增长。如果这是得益于精明的交易,那没什么问题。如果这是由于房地产集团大量举债在不那么主流的地段购买投机性土地,股东们应该感到担心。

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