Chinese developers point to risks after a sharp rebound in stock prices by Reuters
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SHANGHAI (Reuters) – Recent increases in Chinese real estate stocks have prompted some developers, including the Tahoe Group and Sichuan Languang Development Co., to point to investment risks, citing weak bases.
China’s CSI300 Real Estate Index hit a two-month high on Tuesday, bouncing nearly 20% from its November low, driven by signs of easing policy.
Tahoe Group, a struggling developer, has seen shares rise 21% this week, warning investors of the risks on Wednesday.
The company stopped borrowing 49.6 billion yuan at the end of November and is looking for solutions to restructure the debt, Tahoe said in an exchange dossier.
Sichuan Languan, after paying off $ 25.9 billion in debt, said the company had done little to restructure its debt.
“Currently, the company’s share price has deviated significantly from its bases, and our business conditions continue to deteriorate,” Languan said in a statement after a 67% rise in share prices this month.
Beijing Dalong Weiye Real Estate Development Co., which raised its share price by more than 60% this month, warned on Wednesday that its share valuation is three times higher than the industry average.
“We expect investors to pay attention to market risks, make rational decisions, and invest prudently,” Dalong said.
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