State-backed property developer Sino-Ocean tumbled after defaulted on notes, warned wider interim loss

 

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China’s state-backed property developer Sino-Ocean Group tumbled as much as nearly 15% in Hong Kong to hit HK$0.31, before closing 8.1% down at HK$0.34.

The selloff came after the developer defaulted on a guaranteed note and expected wider loss for the first half of the year.

The company said on Monday that the trading of its 6% guaranteed notes due 2024 on the Hong Kong Stock Exchange was suspended from August 14 due to its failure to maker payment of interest of $20.94 million on the notes by the end of the grace period. 

Last month, it’s reported that Sino-Ocean proposed to creditors to extend the principal repayment of a 2 billion yuan ($277.29 million) onshore bond due August 2 by one year.

In addition, Sino-Ocean said it expected to record a loss of 17 billion – 20 billion yuan for the first half of the year, compared to a loss of about 1.087 billion yuan for the same period in 2022. 

The wider loss was mainly because China’s real estate market as a whole remained sluggish in the first half, leading to falling revenue and gross profit margin and increasing impairment provisions for projects. Read more …