Developer to Clear Debt, List A-shares
[引用 2008-03-15 20:37:25]
Guangzhou-based developer Guangzhou R&F Properties plans to slow down its land-acquisition pace, speed up property sales and apply for an A-share listing to trim its gearing ratio.
The Hong Kong-listed firm, which aims to double its annual sales to 50 billion yuan in 2010, has been an active land buyer since its Hong Kong listing in 2005.
It needs to be to stay competitive in the real estate industry.
But a slew of tightening polices launched by the central government since late 2006, have resulted in difficulties for developers to get bank loans.
The situation has promoted many developers to speed up property sales, slow down land acquisitions and brave a choppy stock market to raise enough funds for development.
R&F Properties now boasts a land bank of 24 million sq m in terms of gross floor area. That's enough, the company said, to sustain development for the next three to five years.
"We may slow down our speed in acquiring to reduce our gearing ratio," Chairman Li Sze-lim said yesterday.
The developer's gearing ratio stands at 140 percent, meaning it burdens 40 percent more in debt than it has in assets.
"We hope to drop the ratio to 100 percent in the second quarter of this year by issuing A-shares," he said.
R&F Properties has applied to the mainland regulator for a Shanghai-listing approval, and Li said they hope to hear back from the regulator within two months.
But even if the approval is given, the A-share listing won't be launched immediately, he added, citing the current unfavorable stock market conditions.
Meanwhile, a total of 17 projects will be available for sale this year, and they are expected to fetch 24 billion yuan, compared with the 16 billion yuan brought in last year. The average selling price of these properties may grow by a single-digit rate, slower than years ago, Li said.
Li admitted that the average housing prices on the mainland rose too much last year, especially in the third quarter, but he said the prices have since been dropped back.
R&F Properties registered a 148 percent increase in net profits to 5.3 billion yuan in 2007, while its turnover grew by 45 percent to 14.7 billion yuan, after the company sold 1.4 million sq m of property.
So far this year, the firm has sold 2.6 billion yuan worth of property, which is in line with the company's expectations, Li said. He predicted that the company's net-profit margin will increase from 20 percent in 2007 to 25 percent this year.
The Hong Kong-listed firm, which aims to double its annual sales to 50 billion yuan in 2010, has been an active land buyer since its Hong Kong listing in 2005.
It needs to be to stay competitive in the real estate industry.
But a slew of tightening polices launched by the central government since late 2006, have resulted in difficulties for developers to get bank loans.
The situation has promoted many developers to speed up property sales, slow down land acquisitions and brave a choppy stock market to raise enough funds for development.
R&F Properties now boasts a land bank of 24 million sq m in terms of gross floor area. That's enough, the company said, to sustain development for the next three to five years.
"We may slow down our speed in acquiring to reduce our gearing ratio," Chairman Li Sze-lim said yesterday.
The developer's gearing ratio stands at 140 percent, meaning it burdens 40 percent more in debt than it has in assets.
"We hope to drop the ratio to 100 percent in the second quarter of this year by issuing A-shares," he said.
R&F Properties has applied to the mainland regulator for a Shanghai-listing approval, and Li said they hope to hear back from the regulator within two months.
But even if the approval is given, the A-share listing won't be launched immediately, he added, citing the current unfavorable stock market conditions.
Meanwhile, a total of 17 projects will be available for sale this year, and they are expected to fetch 24 billion yuan, compared with the 16 billion yuan brought in last year. The average selling price of these properties may grow by a single-digit rate, slower than years ago, Li said.
Li admitted that the average housing prices on the mainland rose too much last year, especially in the third quarter, but he said the prices have since been dropped back.
R&F Properties registered a 148 percent increase in net profits to 5.3 billion yuan in 2007, while its turnover grew by 45 percent to 14.7 billion yuan, after the company sold 1.4 million sq m of property.
So far this year, the firm has sold 2.6 billion yuan worth of property, which is in line with the company's expectations, Li said. He predicted that the company's net-profit margin will increase from 20 percent in 2007 to 25 percent this year.
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