UPDATE 2-China developer Sunac shares plunge after year-long suspension ends

Kitco Media
By Reuters
Published:
Updated:
Reuters
(Adds comments, background, updated stock prices) HONG KONG, April 13 (Reuters) - Chinese property developer Sunac China Holdings Ltd's shares fell 45% on Thursday morning after resuming trade following a suspension of more than a year as it looks to restructure its debt after a default. The share slump comes a day after the company said in a statement to the Hong Kong stock exchange that it was to resume trading and was implementing a debt restructuring plan. Shares were down by nearly 60% in pre-market trading but trimmed losses after the market opened. "The stock was catching up with the decline in the property sector during the year of suspension," said Steven Leung, a sales director at UOB Kay Hian.


"It's a good sign that the company could resume trading as it suggested that the company is able to meet the required criteria for a trading resumption," he added. Sunac is among many Chinese developers that defaulted last year as the property sector reeled under a debt crisis. Over the last two years, property firms in China have struggled to sell new houses or have sold them at lower prices than expected. Beijing began rolling out supportive policies late last year as a result. Sunac said in late March that it had reached agreements with a group of offshore creditors to convert its debt into new notes and convertible bonds backed by its Hong Kong-listed shares and shares in its property management unit Sunac Services . Sunac published its overdue 2022 interim results last month, showing a core loss of 11.06 billion yuan ($1.61 billion).


The property industry faces an uneven recovery, with some developers like Sunac and China Evergrande Group striking debt restructuring deals, while others face delisting, said Yan Yuejin, an analyst at the E-house China Research and Development Institution in Shanghai. Earlier this month, the Hong Kong stock exchange cancelled the listing of Chinese developer Cinic Holdings after it failed to meet trading resumption requirements in the time allotted. ($1 = 6.8730 Chinese yuan) (Reporting By Donny Kwok, Anne Marie Roantree and Xie Yu; Editing by Jacqueline Wong and Jamie Freed)

Messaging: annemarie.roantree.thomsonreuters.com@reuters.net))
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.