China

China Vanke Posts Large Sales Drop in July

Summary:

  • China Vanke (000002.SZ) has recorded a large sales drop in July, according to Sina.
  • Sales revenue declined 35% in July compared with June to RMB 27.4 billion.

Why It Matters:

  • July and August are usually the off-season for housing sales. However, China Vanke’s huge sales decline is abnormal, especially in view of the fact that the company posted a sales decrease of only 5.3% in July 2015.
  • China Vanke attributes the huge decline in sales to the battle for control between the company’s management team and its largest shareholders. Many potential buyers cancelled their orders after the battle intensified, and head hunters have also been actively recruiting China Vanke’s employees.
  • The company’s asset restructuring plan is still pending a decision of the board at a second meeting, and the management team is now in a weaker position.