Chinese property giant to be delisted after spectacular fall

The shares of the Chinese property giant Evergrande will be taken from the Hong Kong stock exchange on Monday for more than ten years.

Once upon a time, China’s largest real estate company points to a terrible milestone with a stock market valuation of more than $ 50 billion (£ 37.1 billion). This was before the magnificent collapse under the weight of great debt that strengthened the meteoric rise.

Experts say that the taste is both inevitable and certain.

“Once after the listing, he will not come back,” he says Dan Wang, the director of political risk consultancy Eurasia Group.

Evergrande is best known in a crisis that has been dragged into the second largest economy in the world for years.

Only a few years ago, the Evergrande Group was a shining example of China’s economic miracle.

Founder and President Hui Ka Yan, in 2017, in 2017, the richest people of Asia rose at the beginning of the Forbes list.

Since then, his wealth fell to less than a billion of 45 billion dollars in 2017, as his fell from the Grace company.

In March 2024, Mr. Hui was fined $ 6.5 million and banned from China’s life market to exaggerate his company’s income of $ 78 billion.

The liquidators also investigate whether they will earn cash for the creditors of Mr. Hui’s personal property.

During his collapse, Evergrande had 1,300 projects developed in 280 cities throughout China.

The spread empire also included an electric car manufacturer and China’s most successful football team. After not paying enough debts after the football league thrown from the football league Guangzhou FC.

Evergrande was built with $ 300 billion ($ 222 billion), and the world’s most debtor property developer won the inevitable title.

Beijing emerged after introducing new rules in 2020 to check the amount that great developers can borrow.

New measures have led Evergrande to offer its property with big discounts to ensure that money comes to keep the business alive.

The company, which struggles to meet interest payments, has soon reduced some of its debts abroad.

After years of legal attack, the Hong Kong Supreme Court ordered the company to be injured in January 2024.

Evergrande’s shares have been threatened to list since then because they were removed from trade after the court order.

To this point, the crisis that swallowed the company has erased more than 99% of the stock market valuation.

The liquidation order arrived after the company failed to offer a applicable plan to relieve billions of dollars of overseas obligations.

At the beginning of this month, the liquidation officers announced that Evergrande’s debts were currently 45 billion dollars and so far sold only $ 255 million. They also said that they believe that a complete revision of the business “cannot be reached”.

“Now the listing is absolutely symbolic, but it’s too milestone, Wang says Wang.

Professor Shitong Qiao of Duke University, the only thing left is which creditors are paid and how long they can pass to the bankruptcy process.

The next liquidation hearing is expected to take place in September.

China faces a number of major problems, including US President Donald Trump’s tariffs, high local government debt, weak consumer expenditures, unemployment and aging population.

However, experts say that Evergrande’s collapse affects the country the most as well as serious problems faced by other developers.

“The fall of property was the biggest drag on the economy and the ultimate reason for suppressing consumption.” Says.

This is particularly problematic because it is about one -third of the industrial Chinese economy and is an important source of income for local governments.

“I don’t think China has found a suitable alternative to support the economy of China on a similar scale,” Professor Qiao says.

Jackson Chan, a financial market research platform, said that the property crisis caused “major layoffs” by developers demanded intensively.

And many real estate sector employees who protect their business saw big wage cuts.

The crisis has a major impact on many households because they tend to put their savings into property.

Alicia Garcia-Harrer, the economist of French Bank Natixis Asia Pacific, has seen that many Chinese family savings have gained value, as housing prices have fallen by at least 30%.

This means that the probability of spending and investing is lower.

On the other hand, Beijing announced a series of initiatives aimed at revitalizing the housing market, encouraging consumer expenditures and increasing the wider economy.

From measures to helping new homeowners and to support the stock market, electric cars and household goods to purchase incentives.

Despite the fact that one hundreds of billions of dollars have been poured into the economy, China’s once broadering growth “5%” decreased.

Although most of the Western countries are satisfied with this, it is slow for a country that has grown more than 10% annually until 2010.

In short, probably no.

Even if the Evergrande continues to take headlines, several other Chinese property companies are still faced with great difficulties.

At the beginning of this month, China South City Holdings was ordered by Hong Kong’s Supreme Court, which was the biggest developer to force him since Evergrande.

In the meantime, the competitor real estate giant Country Garden is trying to provide an agreement with creditors to write more than $ 14 billion external debt.

After a series of postponement, the next Supreme Court Hydraulic Hearing in Hong Kong will take place in January 2026.

Professor Qiao, “The whole real estate sector is in trouble. More Chinese real estate firms will collapse.” Says.

Although the Chinese government has taken a series of measures to raise the real estate market and support the economy as a whole, it did not enter to directly recover developers.

Mr. Chan says these initiatives have a positive impact on the real estate market: ” [has been reached] And it must be in a slow healing. However, we probably don’t expect the healing to be too strong. “

Wall Street Investment Giant Goldman Sachs warned that real estate prices in China will continue to fall until 2027 in June.

Mrs. Wang accepts and predicts that China’s tight real estate market will “hit the bottom” in about two years when the demand finally captured the supply.

But Mrs. Garcia-Harrero expresses this sharper: “There is no real light at the end of the tunnel.”

Beijing, “a message open to the intention of not to save the housing sector” sent.

The Chinese government has paid attention to avoid measures to encourage more risky behavior by a heavy debtor industry.

And while In the times of Boom, the real estate market was an important driving force of China’s economic growth, and the priorities of the ruling communist party are now lied elsewhere.

President Xi Jinping focuses on high -tech industries such as renewable energy, electric cars and robotics.

As Mrs. Wang said, “China is making a deep transition to a new age of development.”