Core Viewpoint - China State Construction Engineering Corporation's Eighth Engineering Bureau (CSCEC 8th Bureau) is intensively financing in the public market to address imminent debt repayment pressures, having raised nearly 7 billion yuan since June through various instruments [1][3]. Financing Activities - CSCEC 8th Bureau has issued multiple financial instruments, including two short-term financing bonds totaling 4 billion yuan and an asset-backed security of approximately 850 million yuan [1]. - A 10 billion yuan medium-term note was issued with a 20-year term and a coupon rate of 2.68%, marking the highest interest rate among the bonds issued this month [1][3]. - A further short-term financing bond of 1 billion yuan was issued with a 1.51% interest rate [2]. Debt Pressure - The company faces significant debt repayment pressure, with a total bond scale of 28.705 billion yuan, over 50% of which is due in 2025, amounting to approximately 15 billion yuan [3]. - The repayment schedule for 2025 includes 6 billion yuan in Q2, 6.5 billion yuan in Q3, and 2 billion yuan in Q4, indicating substantial quarterly repayment obligations [3]. - The company's debt-to-asset ratio has been high, projected at 76.42% in 2024, with over 84% of total liabilities being current liabilities [3][4]. Financial Performance - CSCEC 8th Bureau's total assets are reported at 401.73 billion yuan, with a net profit of 12.876 billion yuan, but revenue growth has slowed significantly, with a decline of 3.95% in 2024 [4]. - The company's accounts payable have doubled from 80.7 billion yuan in 2022 to 171.4 billion yuan in Q1 2025, indicating increasing financial strain [3][4]. Real Estate Development Challenges - CSCEC 8th Bureau's real estate development arm, China State Construction Dongfu, has seen a 26.8% decline in sales to 16.05 billion yuan in 2024, with net profit dropping over 90% [5][6]. - The company has struggled to compete in the Shanghai market, with sales lagging behind peers and only one land acquisition recorded in 2024 [6][7]. - The competitive landscape in Shanghai has intensified, making land acquisition more challenging due to high prices and reduced availability [7][8]. Inventory Risks - The company faces significant inventory risks, with unsold properties from earlier projects contributing to financial pressures [9][10]. - As of June 17, 2025, several projects have low sales rates, with some experiencing only 20.6% sales completion [9][10]. - The high inventory levels, valued at approximately 77.392 billion yuan in Q1 2024, pose a risk of impairment [10].