Caixin
Nov 19, 2021 06:24 AM
ECONOMY

Shinsun Says Developer Has Not Defaulted After Shares Plunge

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What’s new: The board of Chinese developer Shinsun Holdings Group assured the market that the company is operating normally and has not defaulted on debt after the company’s stock was hit by an abrupt sell-off.

Hong Kong-traded shares of Shinsun took a nosedive of nearly 54% during trading Thursday, its biggest single-day drop. Shinsun finished the day at HK$1.59 ($0.20), compared with the HK$ 5.59 offering price when it debuted in November 2020.

Shinsun’s board said in a statement it is unaware of reasons for the sell-off, nor does it have any information to disclose under market rules as the company continues operating normally with no debt in default.

The context: Ranked 40th among Chinese developers in term of sales, Shinsun is a major player in eastern China’s affluent Zhejiang province and the surrounding Yangtze River Delta region.

Earlier this month, S&P Global Ratings downgraded Shinsun from B to B-, saying the company may face greater difficulties in the next one to two years partly due to slower sales.

Shinsun booked 14.6 billion yuan ($2.29 billion) of contract sales in the third quarter, down 60% from the previous quarter.

Chinese developers are under mounting pressures amid tightening policy control and growing fears about contagion from China Evergrande Group’s debt crisis. Major developers’ stocks declined Thursday including Evergrande and Country Garden Holdings Co.

Quick Takes are condensed versions of China-related stories for fast news you can use.

Contact reporter Han Wei (weihan@caixin.com) and editor Bob Simison (hello@caixin.com)

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