Core Viewpoint - The article discusses the rise and fall of Xia Haijun, the former president of Evergrande Group, highlighting his financial maneuvers, the company's aggressive expansion strategy, and the subsequent debt crisis that led to his disappearance and legal troubles [4][11][93]. Group 1: Xia Haijun's Background and Rise - Xia Haijun was born in 1964 in Harbin and had a humble background, but he excelled academically, earning multiple degrees [23][24]. - He began his career at CITIC Group, where he demonstrated exceptional management skills, eventually becoming a prominent figure in the real estate industry [25][26][27]. - In 2007, he joined Evergrande as the vice chairman and later became the president, leading the company through a period of rapid growth [30][31][32]. Group 2: Evergrande's Expansion and Financial Strategies - Under Xia's leadership, Evergrande adopted a high-leverage strategy known as "three highs and one low," focusing on aggressive expansion through debt [49][50]. - The company saw significant revenue growth, with sales reaching 373.3 billion yuan in 2016, making it a leading player in the real estate market [43][45]. - Xia was known for his ability to secure financing from various sources, including banks and shadow banking, which contributed to Evergrande's rapid expansion [58][59]. Group 3: The Onset of the Debt Crisis - By 2021, Evergrande faced severe financial difficulties, with total liabilities soaring to 1.97 trillion yuan, leading to a liquidity crisis [72][93]. - The company's financial troubles became public when it failed to pay interest on its bonds, marking the beginning of a significant debt crisis [93][94]. - Xia Haijun's absence during the crisis raised suspicions, as he had reportedly begun selling off his assets before the crisis fully unfolded [86][87][88]. Group 4: Legal Troubles and Asset Freezing - Following the financial collapse, Xia became a target for creditors and regulatory authorities, with investigations into his financial practices [10][100]. - In 2022, a significant amount of funds (134 billion yuan) was discovered missing from Evergrande's accounts, leading to further scrutiny of Xia's actions [98][104]. - Hong Kong courts have since frozen Xia's assets, with claims against him and other executives for the recovery of misappropriated funds [123][125].

Group 1 - Chengdu Bank (601838) plans to issue its first tranche of perpetual bonds with a base size of 8 billion yuan in 2025, with book building scheduled for August 19 [1] - The issuer and the bonds have been rated AAA by China Chengxin International Credit Rating Co., Ltd [1] - CITIC Securities (601066) is acting as the lead underwriter for this bond issuance [1]

Core Viewpoint - New World Development is reportedly selling part of its K11 office property in Shanghai, but the company denies these claims, stating that the office space is only for lease and not for sale [1][2]. Company Situation - The K11 office space, once a valuable asset, is now perceived as a liability due to declining rental rates and increasing vacancy rates in the Shanghai Grade A office market [2][3]. - New World Development's financial situation is under pressure, with a cash-to-short-term debt ratio of 0.67, indicating potential liquidity issues [3][4]. Market Conditions - The Shanghai Grade A office market is facing challenges, with a net absorption of only 85,300 square meters in Q2 2025, a decline of 18.4% quarter-on-quarter and 67.6% year-on-year, alongside a vacancy rate of 23.6% [2][3]. - Average rental rates for Grade A offices have decreased to 6.99 CNY per square meter per day, reflecting a 1.9% decline [2]. Debt and Financing - New World Development is seeking to refinance approximately 87.5 billion HKD (about 11.2 billion USD) in loans by June 2025, as existing loan covenants are expiring [4]. - The company has significant debt obligations, with total interest-bearing liabilities amounting to 151.4 billion HKD, including 32.6 billion HKD due within a year [3][4]. Impact of Perpetual Bonds - The company has four perpetual bonds that require interest payments, which have been delayed, signaling severe liquidity constraints [5][7]. - The delay in interest payments on perpetual bonds is viewed as a strong indicator of the company's financial distress, leading to a significant drop in stock price by 6.47% [7]. Strategic Implications - The rumors of selling the K11 office space highlight the company's need to address its financial challenges and may provide a temporary relief if the sale occurs [7]. - If the sale does not materialize, the company will need to explore other strategies for cost reduction and asset optimization to navigate its financial difficulties [7].

Core Viewpoint - New World Development faces liquidity challenges highlighted by the delay in interest payments on four perpetual bonds, but has secured refinancing to address its debt situation [2][9][24]. Group 1: Perpetual Bonds and Debt Situation - The delay in interest payments on four perpetual bonds has raised concerns, but it is not classified as a typical debt default [3][4]. - As of the end of 2024, New World Development has five perpetual bonds totaling HKD 35.4 billion, with the delayed payments affecting four of them [4][5]. - The company classifies its perpetual bonds as equity under accounting standards, which differentiates them from typical financial liabilities [7][8]. Group 2: Financial Performance and Cash Flow - New World Development has faced significant profitability challenges, with a cumulative loss of HKD 26.6 billion in net profit over 2023 and 2024 due to property valuation losses and inventory write-downs [10][12]. - The company has a cash balance of HKD 21.9 billion against short-term debt of HKD 32.6 billion, resulting in a cash-to-debt ratio of 0.67 [12]. - The total interest-bearing debt amounts to HKD 151.4 billion, with unsecured bank loans constituting approximately 53% of this debt [12]. Group 3: Asset Management and Market Conditions - New World Development's net debt ratio stands at 60%, which is lower than the average of 98% for 50 sample companies in the industry [16]. - The company has invested heavily in properties, which typically have long return cycles, leading to cash flow pressures amid a declining market [18][21]. - The company has experienced net cash outflows in most years from 2018 to 2024, primarily due to debt repayments and dividend payments [18][19]. Group 4: Strategic Responses - New World Development plans to sell non-core assets, including office properties in Hong Kong, to improve liquidity [25]. - The company is also considering mortgaging core assets to extend debt maturities and replace high-interest debt [25]. - Despite current challenges, New World Development retains substantial shareholder equity of HKD 172.7 billion, providing a buffer for capital operations [25].

Core Viewpoint - New World Development, owned by the Cheng Yu-tung family, faces significant financial challenges following the announcement of delayed interest payments on its perpetual bonds, leading to a sharp decline in its stock price and bond values [1][3][4]. Group 1: Financial Impact - New World Development's stock price dropped over 10% in a single day, closing at HKD 4.43, with a trading volume of 33.85 million shares, amounting to HKD 148 million [1][4]. - The company announced a total deferral of USD 77.2 million in debt obligations, with specific perpetual bonds hitting historical lows, such as the 6.15% perpetual bond dropping to 23 cents and the 4.8% bond falling to 15.5 cents [3][4]. - Analysts from Morningstar and Morgan Stanley indicated that while the deferral does not trigger a default, it poses long-term risks due to accumulating repayment obligations [4][6]. Group 2: Business Performance - New World Development reported contract sales of approximately HKD 24.8 billion this fiscal year, achieving over 95% of its annual sales target, with notable sales from projects in Hong Kong [6][7]. - Despite improvements in property sales, HSBC Global Research maintains a "reduce" rating on the company, citing low visibility in business turnaround and potential financial strain affecting dividend payments [6][7]. Group 3: Debt Management - The company is actively working on refinancing its HKD 87.5 billion bank loans and has secured commitments for refinancing, including a new loan of HKD 15.6 billion against its Victoria Dockside property [7]. - New World Development has successfully refinanced approximately HKD 17.76 billion of existing bank loans since July 2024, indicating ongoing efforts to manage its financial obligations [7].