The Aoyuan Real Estate Group stock price on the Hong Kong Exchange Market has dropped about 80% compared to 6 months ago. As a result, about $2.51 billion in market value has evaporated.
Since mid-October, three renowned international credit rating agencies Fitch, Standard & Poor’s, and Moody’s, have continuously downgraded China Aoyuan, Kaisa Group, Fantasia, Greenland Holdings, and Sunshine, and more due to the financial crisis.
According to Epoch Times, the door to foreign financial markets for Chinese real estate companies has closed. Then, on the other hand, domestic financial resources are also facing difficulties.
The new policies of the Chinese Communist Party (CCP) have recently become an obstacle to medium and long-term investment.
An insider of China Aoyuan revealed to China Business News that creditors have repeatedly asked China Aoyuan to repay the loan early. In addition, debt repayment requests spiked since Fantasia’s default in early October.
International Finance News reported that Aoyuan had developed a plan for cash installment and physical asset payment in response to the overdue payment crisis.
Aoyuan China claims the measures have solved the company’s financial difficulties.
As of the end of the trading session on Dec. 3, compared to the share price of $1.07 months ago, China Aoyuan fell 11.88%. And its market value has dropped below $640 million.
In the first half of this year, Aoyuan borrowed another $5.93 billion. However, the tight liquidity of funds decreased Aoyuan’s debt-paying ability.
By the end of June this year, Aoyuan had total assets of $49.62 billion and total liabilities of $41.26 billion.
Of which, $8.11 billion of debt will mature within a year.
All dollar amounts are U.S. dollars.