The Hong Kong stock of China's second-largest developer by
sales touched a low of HK$4.77. Its shares in Shenzhen, which continued trading
during Hong Kong's holidays on Friday and Monday, dropped 5.2% on Tuesday to
8.51 yuan, the lowest since July 2014.
Investors have been dumping Vanke's shares and bonds in the
past few weeks on cash flow concerns, triggering a rare central government
directive to help the Shenzhen-based company beat a liquidity crisis.
China Vanke told an earnings conference on Friday it aimed
to boost its cash flow by slashing debt by 100 billion yuan ($13.83 billion)
over the next two years, and lifting income from businesses other than property
development as it sees continued margin pressure in 2024 and 2025 during a
market correction.
Analysts were disappointed about the lower-than-expected
results and no dividend for the first time.
"We remain cautious on the sustained underperformance
on contracted sales, while the current valuation has not fully factored in the
earnings deterioration in our view," Jefferies said in a report.
Separately, Vanke's business partner based in the
north-eastern province of Shandong, Yantai Bairun Real Estate, published an
open letter to the country's State Taxation Administration over the weekend,
saying Vanke's management, led by its chairman, Yu Liang, had used the company
to misuse funds, run a loan business at high interest rates and evade tax.
In response, Vanke said in a statement to Reuters that
Bairun's "malicious comment" was "gravely unfounded", and
the business dispute between Vanke's unit in Yantai and its local partners was
already subject to legal proceedings.
It added the "false accusations and business
slander" had been defamatory and that Vanke would take legal action to
protect its rights.
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