China

Evergrande Real Estate Posts RMB 280.6 Bln in Sales for First Nine Months

Summary:

  • Evergrande Real Estate (3333.HK) has posted RMB 280.6 billion in sales for the first nine months, as reported by Sina.
  • The company has outpaced China Vanke (000002.SZ) and now ranks first in terms of sales.

Why It Matters:

  • Evergrande Real Estate has been recording accelerating sales since the third quarter. By the end of June, sales of Evergrande Real Estate were still lower than China Vanke by RMB 50 billion. However, Evergrande Real Estate posted over RMB 40 billion in sales for the last three consecutive months, and it has outpaced China Vanke.
  • Due to the fight for control between China Vanke’s management team and its largest shareholder, employee turnover in China Vanke rose significantly recently. As a result, buyers became hesitant to purchase China Vanke’s property, and its sales stagnated.
  • At the same time, Evergrande Real Estate has been purchasing China Vanke’s stock in the capital market, and it is currently the third largest shareholder of China Vanke. Local media suggests that it is possible that Evergrande Real Estate will acquire China Vanke in order to lower its debt ratio.